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The 2008 financial crisis burned bad memories into the back of Americans’ brains: employees being laid off in droves, families struggling to put food on their tables, and a housing market in peril. 

But Zillow’s CEO, Jeremy Wacksman, says the time was the start of a new beginning. Less than one year later, he ditched his job as a marketing and product manager at Microsoft Xbox to join the real estate startup, despite nervous looks from his friends. 

“Back in early 2009, for those that remember, [it] was not a fantastic real estate market,” Wacksman told Fortune in a 2025 Leadership Next podcast episode. 

“I remember talking to friends and family [that] I was going to leave a job at Microsoft…And they were like, ‘Why are you going to go work for this money-losing real estate startup? Real estate’s a terrible market.’”

The Gen Xer explained his marketing degree is what got him the job at Microsoft—but also, what inspired him to ultimately leave. 

“Building a product and then getting that product ever-present in the user’s mind, that’s been the common theme I’ve seen, and it’s driven my passion,” Wacksman said. “It’s what led me to Zillow and it’s honestly what keeps me at Zillow.”

Wacksman joined Zillow as the VP of marketing and product, right around the time the late Steve Jobs introduced the Apple app store—and it turned out to be exactly what the struggling company needed. 

Success came from saying ‘yes’ to responsibilities outside of his day job—including launching on Apple

One of the most pivotal moments for the $10.5 billion real-estate marketplace came shortly after Wacksman joined the business as the VP of marketing and product: Apple was finally taking websites mobile with apps for the iPhone. 

“Six months after I got here, Steve Jobs launched the App Store on the iPhone, and it became clear that this company that had 100-plus people and was a great desktop website needed to go into mobile,” Wacksman recalled to Fortune’s Kristin Stoller and Diane Brady. “Mobile was going to be the future.”

Now, many online businesses, from Zillow and Airbnb, to eBay and Etsy, all have their own bespoke apps to bring convenience to customers. Thanks to Apple’s invention, users could rent out an apartment easily on their phone, sitting in their back pocket. And because Wacksman had spent a quarter of his time at Microsoft working on mobile projects, he was tapped to lead the effort—and saying yes to taking on work outside of his day-to-day responsibilities proved to be a career-defining moment. 

“I wasn’t hired to [help the company go mobile], I was hired to work on the product and marketing efforts. But mobile was new, and I said yes,” Wacksman said. “And in many ways, my career was just 15 years of saying yes to the next thing.”

Wacksman slowly rose the ranks over the next decade and a half, assuming roles including chief marketing officer, president, and chief operating officer, before taking the helm as CEO in August 2024. 

Reflecting on his time at Zillow and the many other ‘yes’ moments he’s committed to, Wacksman said he’s learned to embrace opportunity. There will be times that projects fall through or unexpected challenges come into the fold, but the experiences make for a better leader.

“You’ll throw yourself into something and it’ll work, or you’ll throw yourself into something and it won’t work,” Wacksman said. “You’ll have to pivot, but you’ll have learned something.”

A version of this story was published on Fortune.com on July 2, 2025.

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$100 million in annualized cost savings. Over 3,200 opportunities influenced. Those are the kinds of outcomes leaders everywhere are hoping AI will deliver. But in conversations with CEOs this year, one thing was clear: very few companies can point to results at this level yet.

Many organizations made progress using AI to improve efficiency in 2025. A much smaller group, including companies like Salesforce, is now beginning to see AI contribute to revenue. Across industries, last year’s focus was operational: automate support, streamline internal workflows, reduce repetitive labor. The mandate was straightforward: use AI to improve efficiency and protect margins. Now the pressure has shifted. Boards and investors are asking a tougher question: Where does AI show up in growth?

As part of our research into this shift, who better to go to than a leader in enterprise AI and CRM, Salesforce, which is one of the relatively small number of companies that can show measurable results in both cost reduction and revenue impact from AI agents. Their experience offers an early look at what this transition can look like in practice, and what we can learn from how Salesforce uses its own products at scale as their own “Customer Zero.”

Phase One (2025): Removing the Constraints of Reactive Service

For decades, service organizations operated under a basic constraint: human capacity. Every decision about service levels, speed, and personalization ultimately came down to how many people were available to respond.

In 2025, Salesforce began breaking that constraint. The company deployed AI agents across its customer support ecosystem, starting with its self-service help portal, help.salesforce.com. The portal features a conversational, ChatGPT-style interface and the initial goal was simple:

• Answer common customer questions autonomously
• Maintain conversational context
• Escalate to humans when judgment, complexity, or extreme urgency was required

The Results: Better Service and Lower Cost

In just over one year, Agentforce handled 3 million support conversations, contributing to measurable operational and financial impact:

• Lower case volume despite customer growth — Year-over-year support caseload dropped by 8%, representing more than 170,000 fewer cases, with further reductions forecast.
• Customer experiences previously out of reach — Salesforce now delivers live, synchronous chat support in seven languages, with plans to expand to 14 or more languages by year end, something it had never achieved in its 27-year history.
• More proactive service — With AI agents handling routine questions, human teams can focus on more proactive services to help customers succeed, preventing problems, and building stronger relationships without increasing costs.
• $100M in annualized cost savings — Agentforce reduced support costs while maintaining customer satisfaction — a rare combination in service transformation efforts.

“We already know that AI agents can scale our cost structure infinitely, but the real unlock is that they can help us scale our capacity, too,” says Jim Roth, President, of Customer Success at Salesforce. “When our capacity is infinite, we can be proactive and build more incredible customer experiences. We can treat every customer like they’re our most important customer.”

AI agents helped Salesforce improve service while lowering the cost to deliver it. But at this stage, the primary impact was operational. Margins improved and service expanded, but revenue remained largely unchanged.

Phase Two: Turning AI Agents Toward Growth

By the time leaders reached 2026, the expectation had evolved. If AI could remove cost from service, could it also help create revenue?

Inside Salesforce, one experiment offered an early answer. It started with what employees informally called “sawdust.” Like most large B2B companies, Salesforce generates massive inbound interest through its digital channels: content downloads, webinar registrations, information requests. Each interaction is technically a lead.

But in practice, many of these leads never receive follow-up. They essentially collect like sawdust. Sales teams focus on the highest-scoring prospects. Marketing prioritizes defined segments. A long tail of lower-priority leads sits in the system, untouched. They weren’t worthless. They were simply uneconomical for humans to pursue. That’s where AI agents entered the picture.

The “Sawdust” Experiment

Salesforce deployed an AI agent to engage these dormant leads autonomously. The agent could:

• Send personalized outreach
• Ask qualifying questions
• Respond based on context
• Identify signals of genuine buying intent
• Route promising prospects to human teams

These were leads the company didn’t have the capacity to work anyway, which made them a low-risk but high-upside test case.

In a short period of time, the agent began working on hundreds of thousands of previously untouched leads. The result wasn’t just more activity. It showed up in revenue metrics:

• Significant new pipeline created 
• More than 3,200 opportunities influenced 
• Closed business from opportunities that would otherwise have remained invisible

This wasn’t AI making an existing sales team faster. This was AI creating revenue from a segment of demand that had effectively been written off.

A Broader Shift in How AI Is Used

Together, these two phases show how the role of AI in the enterprise is beginning to evolve, at least among a small but growing set of organizations seeing concrete results. In early stages, AI agents are most often used to reduce operational friction — taking on repetitive work, stabilizing service levels, and freeing human teams to focus on more complex or higher-value work. In more advanced cases, companies are beginning to use AI agents to generate revenue in areas where human effort never made financial sense.

The “sawdust” leads were one example. Other companies are now exploring similar uses of AI to:

• Stay in regular contact with existing customers who rarely engage
• Identify small upsell or cross-sell opportunities humans might overlook
• Spot early signals that a customer is ready to buy again
• Reconnect with past prospects who went quiet months or years ago

In each case, AI agents help companies pursue customers and opportunities they previously ignored.

From Cost Story to Growth Story

The shift from 2025 to 2026 shows how executive expectations have changed. Last year, success meant proving AI could reduce cost and improve efficiency. This year, success increasingly means proving AI can help grow the business.

Salesforce’s journey shows how those phases connect. AI agents first helped transform customer service by removing capacity constraints and enabling more proactive support. Now, the same underlying capability is being used to pursue revenue opportunities that humans simply didn’t have the bandwidth to chase.

AI is beginning to move beyond the back office and support queue into revenue-related workflows. For a small group of companies, that shift is already producing measurable impact. For many others, it remains the next horizon.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Landing a job—especially one that is well-paid and personally fulfilling—can feel like the hardest part of building a career. But in today’s uncertain labor market, even established professionals face sudden transitions, and mid-career pivots can feel just as destabilizing as early-career ones.

Just ask Dana Perino.

After George W. Bush’s administration ended, the former White House press secretary found herself at a crossroads. She’d spent nearly her entire career in government, so stepping outside that world wasn’t exactly a comfortable leap. She landed a public relations job—and almost immediately knew it was a mistake.

“It was pretty clear after two hours that I didn’t like it,” the now-Fox News host recently told Fortune. 

Weeks in, Perino found herself back at an event with her former boss, venting about the situation. Bush responded with a question that reframed everything.

“He made me answer this question: ‘What’s the worst thing that could happen if you started your own thing and it failed? Let’s talk it through honestly,’” she recalled. “As we talked it through, it was clear I wasn’t going to become homeless and live on the street.”

By the end of the conversation, Bush delivered the takeaway: If the worst-case scenario was simply returning to another PR firm, then the risk wasn’t nearly as high as it felt.

“And he was right.”

Even with an uncertain future, Perino’s advice for Gen Z is simple: focus on what’s right in front of you

While Perino did quit and go on to start her own firm—which eventually led her to her current roles as the host of America’s Newsroom and The Five on Fox News—that kind of career uncertainty is becoming more common. Artificial intelligence is being integrated more deeply across industries, automating skills—such as coding, research, and editing—that were once the domain of specialized professionals. At the same time, companies have been quietly trimming their workforces, betting that leaner teams can drive better efficiencies.

For younger workers, the pressure is especially intense. While Gen Z is eager to enter the workforce, entry-level opportunities have tightened, and the unemployment rate for workers ages 16 to 24 reached 10.8% last year—more than twice the national average.

Perino’s takeaway is less about long-term planning and more about short-term clarity: stop trying to map out every step of your career and focus instead on the immediate opportunity in front of you—even if it isn’t perfect on paper.

That lesson, she said, showed up in her own career decisions as well. Trying to engineer a flawless long-term plan, she noted, can sometimes obscure opportunities that don’t fit neatly into it.

“Once I focused and stopped trying to do everything, all the other opportunities came at the right time,” she added.

That mindset also helped her latest project. 

Perino’s first novel, Purple State, is set to hit shelves on April 21 and is centered around a young PR professional navigating her career and personal love life. The thriller draws on Perino’s years in politics and the media.

George W. Bush: ‘You ought to be open-minded as to where life takes you’

Bush has offered similar reflections on uncertainty and adaptability. During his post-presidency, he emphasized the value of flexibility over rigid life planning.

“People who plan their life when they’re 18 years old and say, ‘This is my life plan,’ would generally be surprised and maybe disappointed,” Bush said in a 2011 interview with AARP.

“I think you ought to be open-minded as to where life takes you. One of the things I learned as president is that your life is just not going to unfold the way you want it to. There will be surprises, challenges, and therefore the question is how you deal with the unexpected.”

And while Bush’s advice helped guide Perino’s brief period in her career, he’s someone who’s on both sides of the table. During his second term, he called his predecessor, former President Bill Clinton, about twice a year to talk through the challenges he was facing.

“He asked my opinion,” Clinton recalled in a video that recirculated on social media earlier this year. “Half the time he disagreed with it, but I felt good about that. I thought that was a really healthy thing.”

The 42nd president said those exchanges underscored a larger point about leadership: the value of actively seeking out perspectives that differ from your own.

“You’ve got to cultivate people who know things you don’t and have skills you don’t, and yes, that can be taught,” Clinton added. 

“If nothing else, we can help people get out of their own way. Everybody’s got a story and a dream, and they can bring it to bear if we can just help people get out of their own way sometimes.”

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Nine months ago, Sam Brown was out of a job. The reason, he’ll tell you without a sense of bitterness, was artificial intelligence. The company he’d spent years building a career inside decided it needed fewer people, and he was one of them.

“I got laid off nine months ago, and it was AI-related,” said Brown, 48, with a career that stretches back to 2000, aside from a few months as a ball boy for the Denver Nuggets in his youth. “I had to sit there and say, ‘This is a blessing, because I get a head start on everyone else that’s going to have to go through this in a little while.’”

He didn’t spend long feeling sorry for himself. Instead, Brown joined a three-person startup with no venture funding, no engineering team, and no traditional software infrastructure. What they did have were 12 AI agents.

$300 in, $300,000 out

Fathom AI, an Austin-based sales enablement platform built specifically for the medical aesthetics industry, launched in early 2026. Within 12 weeks, it achieved an estimated annual recurring revenue of $300,000, gross margins north of 90%, and operating costs under 10% of revenue, according to records reviewed by Fortune. And the total capital invested to start the company was just $300.

“We launched 2.5 months ago, and right now, we have $300,000 in ARR,” said Brown, who manages the three-person company’s finances as the president of Fathom AI.

The company has taken no outside funding. When venture capitalists came calling, Fathom got all the way to the finish line on a term sheet and walked away—not because the deal was bad, but because they genuinely couldn’t figure out what they’d spend the money on.

“The VC said, ‘You’re going to need an engineering team of this size, a customer success team of this size,’” Brown recalled, adding that when he and Fathom’s founder and CEO Ben Hooten walked out of the meeting, they basically said, “We’re not going to need that.”

courtesy of Fathom AI

By year-end, Fathom projects $5 million in ARR across 15 to 18 enterprise customers. The team is structured as a partnership specifically to distribute profits now, a deliberate decision to get paid rather than hold out for a distant exit in a market none of them can predict.

Brown explained to Fortune that the partnership is essentially like collecting a paycheck. “We’d rather take the money now and then, there’s not a lot to reinvest in, because we don’t have huge costs.”

“Hell,” added Dan Crump, the senior member of the trio, at 56 years old, “we got paid today, as a matter of fact. We’re cash-flow positive.”

The skeptic who became the proof

Kirk Gunhus has been in the medical aesthetics industry for 30 years. He has gray hair and, by his own cheerful admission, is “not a technology guy.” He wasn’t interested when Fathom AI first pitched him on switching vendors.

The origin story starts with a frustrated rant. The CEO, Hooten, then still a sales rep, was sitting in one of Gunhus’ meetings when Gunhus, a couple of beers in, unloaded on the state of sales technology. “You’ve got all this stuff here, and none of it really works well,” Gunhus said. “Someone needs to just put it all together, so when I walk into a zip code, I know exactly what accounts are perfect for us to go after.”

He forgot about his rant immediately, but Hooten didn’t. Gunhus said he got a call the very next weekend from Hooten, who said he put a plan together.

Gunhus agreed to a pilot with six sales reps. The company, he said, couldn’t afford the subscription, but every one of those six reps paid individually to work with Fathom AI. That’s “because it works,” Gunhus said. “It’s making them so much money.”

The results bore him out. In all of 2024, one of Gunhus’ consulting clients, Tiger Aesthetics, did not open a single net new account. Within one quarter of deploying Fathom, he said they had opened 225. “The bosses over at Tiger are like, ‘[Give them] whatever they want.’ They just saved a ton of money.”

The medical aesthetics industry is a multibillion-dollar world of plastic surgeons, dermatologists, med spas, and device manufacturers and, according to Fathom AI and their clientele, it’s ripe for disruption. Sales have historically been entirely manual. Reps cold-called, drove routes blind, and relied on memory and intuition to figure out who to see and when.

Fathom replaces all of that. A rep enters a zip code, and the platform surfaces every nearby account that fits their product profile, ranked by fit. It layers in real-time Google search data so a rep can walk into a doctor’s office and say, with specificity, what that physician’s patients are searching for. It also serves as a live training tool: new hires roleplay sales scenarios against an AI that corrects their technique in real time, flagging wrong answers and asking follow-up questions.

The team that isn’t supposed to exist

Hooten, the CEO and the junior member of the group at 39, explained to Fortune that his 12 agent co-workers hold real operational roles—one runs customer success for a national sales force; another wakes up every two hours to scan the competitive landscape and file a briefing.

His background was in sales, not software, Hooten explained, and so he looks at the AI agent era as a chance to build things that he never had the skills to, before. When a colleague told him that he couldn’t build an automated sales tool that actually worked, he built it anyway, and on his first day using it in the field, he closed $440,000 in a single day.

Gunhus said he had firsthand experience with the customer service bot: a Tiger Aesthetics rep called with a support issue, was walked through the solution by what they believed was Hooten on the line, and had no idea they’d been talking to an AI. “The rep has no idea what’s going on, literally.”

courtesy of Fathom AI

Crump, the senior member of the group, at 56 years, is a former Marine with decades in tech sales experience at companies including GE and IBM. He has watched every major tech cycle from the early internet to the smartphone era. He recalled one morning about 25 years ago visiting Enron, when he was working as a sales rep for HP, the exact time when the famous accounting fraud was going belly-up. “The elevator door opened, and a lady had a plant and a Herman Miller chair, and she was rolling it out of there, cussing,” Crump recalled. “I go up, and my buddy says, ‘Hey, somebody just tried to throw a chair through the window.’” He’d been on the phone with his manager minutes earlier to confirm Enron owed his company $27 million—and that it had cleared the Friday before. “So I was like, ‘Okay, thank God we’ll get paid,’” he said. “I’ve seen a lot of stuff.”

In this industry, he added, sometimes tech sales is “just uninspiring.” With Fathom, he said he feels like they’re making “something that makes a difference.”

The 23-year-old parallel

Fathom isn’t the only small team rewriting the economics of what a company can be. Half a continent away, in Toronto, Yatharth Sejpal is running a strikingly similar experiment, and he’s 23 years old.

Sejpal is the CEO of KNOWIDEA, a predictive intelligence platform that advises executives on decision-making. He has no computer science background—”never written a line of code in my life,” he said—but within six months of launching he said he has closed $500,000 in ARR with six enterprise clients spanning energy, manufacturing, professional services, and financial services. He co-founded the firm with Brian Zhengyu Li, who is completing a PhD and previously worked as an applied scientist intern at Amazon Web Services.

Like Fathom, KNOWIDEA is a three-person operation. And like Fathom, Sejpal passed on early VC money. “If I wanted to exit, I would have taken VC money really quickly,” he said. He turned down a spot in Antler, one of the world’s largest startup accelerators, because he didn’t want to dilute equity before proving his model. Instead, he took a strategic investment check, from a consulting firm, not a venture fund, at a $15 million valuation.

His pitch to enterprise clients is almost a philosophy as much as a product. “Leaders need clarity,” Sejpal told Fortune from a hotel room (he said he spends nearly all his time traveling). “That’s it. There is no other reason, a dashboard, a report, all of it is just to bloody get clarity.” His platform ingests decentralized data and produces ranked, risk-weighted insights for C-suite decision-makers.

Crucially, Sejpal is careful about what his platform won’t do. On the question of AI hallucinations, a persistent concern among executives considering high-stakes AI tools, he draws a clear line. “At the core of decision-making is clarity plus judgment,” he said. “Our job is to give clarity. Your job is to make the judgment.” His system flags predictions that deviate dramatically from market norms and filters them out before they reach a client.

Sejpal, who grew up in India and moved to Canada to attend the University of Waterloo, spent years inside some of the largest people consulting firms in the world before deciding the industry was ripe to be disrupted. His vision of where the three-person company model leads is more radical than his current headcount suggests. He doesn’t think three-person teams are the endgame: he thinks they represent the beginning of a total restructuring of how work gets organized.

“I don’t want to ever hire an account executive or a customer success manager,” he said. “The only two roles that we want to hire are FDEs and FDCs, forward deployed engineers and forward deployed consultants.” One person who understands what data to select, and one who understands what context to apply. “Everything else,” he said, “can be automated using artificial intelligence.”

That logic extends to his larger argument about the enterprise. Take 20-person project teams, for example: “I think that is going to slim down to a two-person team. FDC plus FDE can do all of the work, and then one supervisor who can overlook. That’s it. It’s as non-complicated as that.”

It hasn’t been as lucrative for Sejpal as it has for the Fathom co-founders, but he’s not concerned about that yet. His savings dwindled for months until the spring of 2026, when he finally started drawing a salary, but he cheerfully said that his excitement about what he’s doing is more than enough for him. “If I if I wanted to make money, there are much simpler, less strenuous, mentally and body-exhausting tasks that I can do. I’m worried every single night, I have night sweats thinking how I’ll make salary for my employees, how I’ll grow my team and 20 other headaches. I could have made much more money without having a single of those stress.”

Dramatic implications

Brown was careful to say that the Fathom story isn’t primarily about Fathom. It’s about what Fathom represents: the first wave of a much larger shift in who gets to build a software company and who has the advantage doing it. In fact, thanks to AI, businesses have exploded in recent years, and it looks like there’s no chance of stopping what innovations can come next, according to financial firm Apollo.

The VC model was built around the assumption that you needed massive capital to build technology: engineering teams, customer success departments, sales headcount. That assumption is now structurally broken. A platform that once required $10 million in seed funding to staff can be assembled by three experienced operators and a suite of AI agents for the cost of a dinner out.

That changes who wins. Gunhus, for his part, said he’s not interested in launching his own three-person AI startup. “I’ve done all that, I don’t want to go through all that mess again.” But he’s watching carefully and telling everyone he knows to pay attention to the AI agent revolution. “If you don’t use it,” he said, “it’s gonna run you over anyway.”

That’s more or less the same conclusion Sam reached nine months ago, sitting with a pink slip and a decision to make about what came next. He doesn’t sound like a man who was laid off. He sounds like a man who got lucky.

“Everyone’s going to have to go through this to some extent,” Sam said. “I just think I got to go through it a little earlier than most.”

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Iran swiftly reversed course on reopening the Strait of Hormuz, reimposing restrictions on the critical waterway on Saturday after the U.S. said it would not end its blockade of Iran-linked shipping.

Iran’s joint military command said on Saturday that “control of the Strait of Hormuz has returned to its previous state … under strict management and control of the armed forces.” It warned that it would continue to block transit through the strait as long as the U.S. blockade of Iranian ports remained in effect.

The announcement came the morning after U.S. President Donald Trump said that even after Iran announced the strait’s reopening on Friday, the American blockade “will remain in full force” until Tehran reaches a deal with the U.S., including on its nuclear program.

The conflict over the chokepoint threatened to deepen the energy crisis roiling the global economy after oil prices began to fall again on Friday on hopes the U.S. and Iran were drawing closer to an agreement. Roughly one-fifth of the world’s oil passes through the strait and further limits would squeeze already constrained supply, driving prices higher once again.

Control over the strait has proven to be one Iran’s main points of leverage and prompted the United States to deploy forces and initiate a blockade on Iranian ports as part of an effort to force Iran to accept a Pakistan-brokered ceasefire to end almost seven weeks of war that has raged between Israel, the U.S. and Iran.

Iran said it fully reopened the Strait of Hormuz to commercial vessels after a 10-day truce was announced between Israel and the Iranian-backed Hezbollah militant group in Lebanon. An end to Israel’s war with Hezbollah was a key demand of Iranian negotiators, who previously accused Israel of breaking last week’s ceasefire with strikes on Lebanon. Israel had said that deal did not cover Lebanon.

But after Trump said the blockade would continue, top Iranian officials said his announcement violated last week’s ceasefire agreement between Iran and the U.S. and warned the strait would not stay open if the U.S. blockade remained in effect.

A data firm, Kpler, said movement through the strait remained confined to corridors requiring Iran’s approval.

U.S. forces have sent 21 ships back to Iran since the blockade began on Monday, U.S. Central Command said on X.

Pakistan announces progress toward new deal

Despite the escalation in the Strait of Hormuz, Pakistani officials say the United States and Iran are still moving closer to a deal ahead of the April 22 ceasefire deadline.

The ceasefire in Lebanon could clear one major obstacle to an agreement. Speaking at a diplomatic forum in Antalya, Turkey, Pakistan’s Foreign Minister Ishaq Dar said the ceasefire in Lebanon was a positive sign, noting that fighting between Israel and Hezbollah had been a key sticking point before talks in Islamabad ended “very close” to an agreement last weekend.

Pakistan’s army chief Field Marshal Asim Munir visited Tehran, while Prime Minister Shehbaz Sharif met with Turkish President Recep Tayyip Erdogan and Qatar’s Emir Tamim bin Hamad Al Thani in Antalya, the military and Sharif’s office said. Pakistan is expected to host a second round of talks between Iran and the U.S. early next week.

Questions linger about Lebanon truce

Even though mediators were optimistic, it was unclear to what extent Hezbollah would abide by a truce it did not play a role in negotiating and which will leave Israeli troops occupying a stretch of southern Lebanon.

Trump said in another post that Israel is “prohibited” by the U.S. from further strikes on Lebanon and that “enough is enough” in the Israel-Hezbollah war.

The State Department said the prohibition applies only to offensive attacks and not to actions taken in self-defense.

Shortly before Trump’s post, Israeli Prime Minister Benjamin Netanyahu said Israel agreed to the ceasefire in Lebanon “at the request of my friend President Trump,” but that the campaign against Hezbollah is not complete.

He claimed Israel had destroyed about 90% of Hezbollah’s missile and rocket stockpiles and added that Israeli forces “have not finished yet” with the dismantling of the group.

In Beirut, displaced families began moving toward southern Lebanon and Beirut’s southern suburbs despite warnings by officials not to return to their homes until it became clear whether the ceasefire would hold.

The Lebanese army and U.N. peacekeepers in southern Lebanon reported sporadic artillery shelling in some parts of southern Lebanon in the hours after the ceasefire took effect.

The war, which began with U.S. and Israeli strikes on Feb. 28, has killed at least 3,000 people in Iran, more than 2,290 in Lebanon, 23 in Israel and more than a dozen in Gulf Arab states. Thirteen U.S. service members have also been killed.

__ Metz reported from Ramallah, West Bank. Associated Press writers Munir Ahmed in Islamabad and Andrew Wilks in Antalya, Turkey contributed to this report.

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U.S. President Donald Trump and Iran’s foreign minister said Friday that the Strait of Hormuz is fully open to commercial vessels. Iran’s top diplomat Abbas Araghchi said the strategic waterway “is declared completely open,” in line with the new ceasefire in Lebanon, and Trump said the strait is “ready for full passage.”

However, Trump added that the U.S. naval blockade on Iranian ships and ports “will remain in full force” until Iran reaches a deal with Washington to end the war.

Oil prices dropped 9% and Wall Street rallied to a record after Iran said the strait is open, allowing tankers to resume shipments from the Persian Gulf. Stocks are heading for a third straight weekly gain, on hopes the U.S. and Iran can avoid a worst-case scenario for the global economy.

A 10-day ceasefire in Israel and Lebanon began at midnight and appears to be holding after more than a month of war between Israel and Hezbollah, although the Iran-backed Lebanese militant group is not a party to the deal. Israeli Prime Minister Benjamin Netanyahu said Israel is “not yet finished” with Hezbollah. The militant group said its response will depend on how events unfold.

The fighting has killed at least 3,000 people in Iran, nearly 2,300 in Lebanon, 23 in Israel and more than a dozen in Gulf Arab states. Thirteen U.S. service members have also been killed.

Here is the latest:

Trump rejects notion of tolls by Iran on Strait of Hormuz

President Donald Trump flatly rejected the idea when a reporter asked about the prospect of restrictions or tolls managed by Iran on the Strait of Hormuz.

“Nope. No way. No. Nope,” Trump said. He said there can’t be tolls along with restrictions. “No, they’re not going to be tolls.”

More than 20 ships turned back by US blockade

US Central Command says that since the blockade began on Monday, 21 ships returned to Iran at the direction of U.S. forces.

U.S. President Donald Trump said earlier on Friday that the American blockade of Iranian ports would remain “in full force” until Iran reaches a deal with the U.S., including on its nuclear program.

Australia says opening of Strait of Hormuz is ‘positive news’

“We hope that it certainly holds. This was positive news that we received last night,” Australian Prime Minister Anthony Albanese told reporters in Sydney on Saturday.

“But we know that it’s very fragile and we don’t assume the best. What we do is prepare as best we can for the uncertainty which is there,” Albanese added.

Israel experiences first 24 hours without incoming strikes since Iran war started

It’s been more than 24 hours since air raid sirens went off in any part of Israel — and that last time, very early on Friday morning in a small community at the border with Lebanon, turned out to be a mistaken identification.

Since the Iran war started on Feb. 28, Iran, then Lebanon-based Hezbollah militants and eventually the Houthis in Yemen sent barrages of missiles and rockets into Israel, sometimes more than a dozen times a day. Hezbollah kept up firing right until a ceasefire went into effect Friday.

In Israel’s major metropolitan areas of Jerusalem and Tel Aviv, but also in villages in the country’s desert south and hilly north, sirens and alerts sent residents to bomb shelters and safe rooms throughout the day and night.

The strikes have killed 23 people and wounded about 600 more, according to Israel’s emergency services.

Iran warns US blockade risks fresh Strait of Hormuz closure

Iran’s parliamentary Speaker Mohammad Bagher Qalibaf posted on X early Saturday that if the U.S. blockade continued, “the Strait of Hormuz will not remain open.”

On Friday, Iran had said it fully reopened the Strait of Hormuz to commercial vessels, but U.S. President Donald Trump said the American blockade on Iranian ships and ports would “remain in full force” until Tehran reaches a deal with the U.S.

And a data firm, Kpler, said later Friday that movement through the strait remained confined to corridors requiring Iran’s approval.

Trump says US will go into Iran and excavate uranium

“The USA will get all the nuclear dust,” Trump said in a speech in Arizona. “We’re going to get it by going in with Iran with lots of excavators.”

Iran has yet to confirm that its agreed to give up the 970 pounds (440 kilograms) of enriched uranium believed to be buried under nuclear sites badly damaged by U.S. military strikes last year.

Giving up the uranium and agreeing to U.S. troops entering Iranian territory would be huge concessions by Iran.

Trump insisted that “no money will exchange hands in any way, shape or form” as part of a potential deal with Iran to end the war.

China willing to take custody of highly enriched uranium from Iran, AP source says

China is open to taking possession or downgrading some 970 pounds (440 kilograms) of enriched uranium that Trump says must be removed from Iran as part of a deal to end the war, according to a diplomat familiar with Beijing’s thinking on the matter.

At the moment, it appears Trump wants the U.S. to take custody of the material that is believed buried under nuclear sites badly damaged in an American bombardment last June.

But China, which is Iran’s biggest trading partner, is signaling it would be open if asked by Washington and Tehran to take the uranium or down-blend to levels that could be used for civilian applications, said the diplomat who was not authorized to comment publicly and requested anonymity to discuss the sensitive matter.

In 2015, under the Joint Comprehensive Plan for Action, Iran shipped approximately 25,000 pounds (11,000 kg) of low-enriched uranium to Russia to meet an essential requirement to fulfill that nuclear deal. — By Aamer Madhani

USS Ford returns to the Middle East

The world’s largest aircraft carrier, the USS Gerald R. Ford, has again entered the waters of the Middle East, two defense officials told the Associated Press.

The Ford, which until recently was operating in the Eastern Mediterranean, transited the Suez Canal, along with a pair of destroyers, the USS Mahan and the USS Winston S. Churchill, and is now operating in the Red Sea, one official said.

Both spoke on condition of anonymity to discuss sensitive military operations.

The Ford is returning to the Red Sea after more than a month in the Mediterranean following a major fire in a laundry space that forced the ship back to port for repairs. The carrier also broke the record for the longest aircraft carrier deployment since the Vietnam war this week.

The Ford’s arrival makes it the second aircraft carrier in the region in addition to the USS Abraham Lincoln in the Arabian Sea. The USS George H. W. Bush is also heading towardH.W. Bushn and is currently off the coast of South Africa, according to one defense official.

Vessel movement remains constrained in the Strait of Hormuz

Data firm Kpler said ship movement through the Strait of Hormuz remained confined to corridors requiring approval on Friday evening, hours after the U.S. and Iran announced full reopening of the strategic waterway.

Iran’s state media reported the country’s conditions to reopen the Strait of Hormuz, which has been effectively closed since the beginning of the war, included that all commercial vessels transiting must go through a route designated by Iran and in coordination with the IRGC Navy.

Kpler said that “markets have responded with cautious optimism” to the reopening decision, but warned that underlying supply dynamics remain tight, and a “full normalization in trade and confidence is likely to take months, not weeks.”

Oil prices fall sharply and Wall Street rallies to a record as Iran reopens the Strait of Hormuz

Oil prices dropped back to where they were in the early days of the Iran war, while U.S. stocks raced to another record.

The S&P 500 leaped 1.2% Friday after Iran said the Strait of Hormuz is open again for commercial tankers carrying crude.

The Dow Jones Industrial Average leaped as many as 1,100 points before paring its gain and ended with a jump of about 870 points, or 1.8%, while the Nasdaq composite climbed 1.5%.

A freer flow of oil could take pressure off prices not only for gasoline but also for groceries and all kinds of other products. Oil prices fell 9%.

Iran’s navy chief says Trump’s naval blockade is ‘piracy and maritime theft’

The commander of the Iranian navy, Shahram Irani, said Friday evening that Trump “has blockaded his friends” and not Iran, as the U.S. said its blockade will remain in place after Iran declared the Strait of Hormuz open to commercial traffic.

In a statement carried by Mizan, Iran’s official judiciary news agency, the navy chief said Trump’s blockade is just “empty words” and that no one is listening to him.

The U.S. military says it has turned 19 ships back to Iran since imposing the blockade earlier this week.

Lebanese president says negotiations are ‘not a weakness’ and the country has reclaimed its sovereignty

President Joseph Aoun struck a defiant tone in his first address since a U.S.-brokered ceasefire took hold, saying he wants Lebanon to chart its own course after weeks of war between Israel and Hezbollah.

The president said he wants to see Lebanon “flourishing, not committing suicide.” He condemned Hezbollah’s rocket fire into northern Israel that triggered the latest round of fighting, and criticized Iran’s role in arming and backing the group.

He framed both as violations of Lebanese sovereignty, and again vowed to disarm non-state groups, including Hezbollah.

In a pointed response to Hezbollah’s criticism of Lebanon’s direct talks with Israel and claims that Beirut lacks leverage, Aoun said the country will make its own decisions and stand by demands shared across Lebanese society, not ones dictated by Iran or its allies.

“There will be no concessions to any principle, no infringement of the sovereignty of this country,” he said.

Aoun also reiterated calls for Israel to halt attacks, withdraw troops, release detainees and allow displaced people to return.

US Treasury sanctions Iraqi militias backed by Iran

The U.S. imposed sanctions on seven senior commanders of Iraqi militias that are supported by Iran, including groups like Kataib Hezbollah and Asaib Ahl al-Haq, for allegedly planning and carrying out attacks on U.S. personnel and coalition forces in the region.

Officials have said the move is part of a broader effort to counter Iran’s influence in Iraq and deter further violence against U.S. interests.

The action also signifies a U.S. strategy of using economic pressure, not just military force, to target Iran’s network of allies, while warning global banks and firms to stop doing business with anyone tied to these groups.

“We will not allow Iraq’s terrorist militias, backed by Iran, to threaten American lives or interests,” Secretary of the Treasury Scott Bessent said Friday. “Those who enable these militias’ violence will be held accountable.”

Head of US Central Command says ships are moving through the Strait of Hormuz

“We’ll see what this looks like going forward. But I think we should all remain optimistic,” Adm. Brad Cooper told reporters Friday after Iran announced the vital waterway was open to commercial vessels.

US Central Command leader says military will clear mines in Strait of Hormuz

The top commander in the Middle East confirmed that the U.S. military will be working to clear mines from the Strait of Hormuz but would offer no details on the scope of the task.

“It’s a mission that we’ve undertaken,” Cooper told reporters on a call Friday before adding that he wouldn’t want to “characterize” the extent to which the critical waterway has been mined by Iran as part of a weekslong conflict with the U.S. and Israel.

Cooper said that it was “well within our ability to remove mines.”

Earlier on Friday Trump said in a social media post that “Iran, with the help of the U.S.A., has removed, or is removing, all sea mines!”

US Central Command chief says military still has ‘eyes on every Iranian port’

The top U.S. military leader in the Middle East said Friday that the American naval blockade of ships tied to Iran will remain in place for as long as Trump “says it will remain in effect.”

Adm. Brad Cooper, who leads Central Command, told reporters on a phone call that “U.S. forces have eyes on every Iranian port.”

“We are watching every Iranian ship in every port. Period. Full stop,” Cooper said, adding that the U.S. military presence can stay in the region indefinitely.

“We’re well-provisioned. We’re well-manned. We have all the forces necessary to sustain this for as long as necessary,” Cooper said.

Iran threatens ‘reciprocal measures’ if US blockade continues

In comments published by Iranian state media Friday, Foreign Ministry spokesperson Esmail Baghaei slammed the ongoing U.S. blockade of Iranian ports as a violation of the ceasefire agreement.

He said the Strait of Hormuz remains under the supervision of Iran, which is serious about its commitments. But if the U.S. violates its own commitments, then “Iran will take the necessary reciprocal measures.’’

“No leniency will be shown in this regard,” he said.

First cruise ship transits the Strait of Hormuz since the Iran war began

The vessel-tracker MarineTraffic said the Malta-flagged passenger vessel, reportedly sailing without passengers and bound for Oman, departed Dubai on Friday after remaining docked for 47 days.

It said the Celestial Discovery ship is expected to arrive in Oman on Saturday.

Hours earlier, Iran and the U.S. said the strategic waterway, which has been effectively closed since the beginning of the conflict, will be fully open to commercial traffic.

UN chief says opening the Strait of Hormuz is ‘a step in the right direction’

Secretary-General Antonio Guterres reiterated the United Nations’ position: “We need the full restAntónio Guterresnational navigational rights and freedoms in the Strait of Hormuz to be respected by all parties,” his spokesman said.

Guterres supports diplomatic efforts “to find a peaceful path forward out of the current conflict in the Middle East,” U.N. spokesman Stephane Dujarric said.

“He also hopes that, together with the ceasefire, this measure will contribute to creating confidence between the parties and strengthen the ongoing dialogue facilitated by Pakistan,” the spokesman said.

What exactly did Trump ‘prohibit’ Israel from striking in Lebanon?

The State Department said Trump’s announced prohibition on Israeli strikes inside Lebanon applies only to offensive attacks and not to actions taken in self-defense, and referred to the third point of Wednesday’s agreement by Israel and Lebanon.

That point says “Israel shall preserve its right to take all necessary measures in self-defense, at any time, against planned, imminent, or ongoing attacks.” It adds that Israel “will not carry out any offensive military operations against Lebanese targets, including civilian, military, and other state targets, in the territory of Lebanon by land, air, and sea.”

With the ceasefire only a few hours old, Israel has already launched at least one deadly drone strike in southern Lebanon, according to the health ministry there. During the previous ceasefire, Israel struck what it said were Hezbollah targets almost daily.

Trump suggests a second round of direct US-Iran talks could happen this weekend

“The Iranians want to meet,” Trump said in a brief telephone interview with the news outlet Axios. “They want to make a deal. I think a meeting will probably take place over the weekend.”

Despite the ceasefire, an Israeli drone strike in Lebanon kills 1 person

An Israeli strike in the area of Kounine hit a car and a motorcycle, killing one person and wounding three, including a Syrian citizen, Lebanon’s health ministry said Friday. It was the first airstrike and first fatality reported since a 10-day truce between Israel and the Lebanese militant group Hezbollah took effect overnight.

The Lebanese army and U.N. peacekeepers in southern Lebanon had reported sporadic artillery shelling in some parts of the south in the hours after the ceasefire took effect.

The Israeli army did not immediately respond to a request for comment. Israel has maintained that it still has the right to strike in Lebanon in response to perceived threats despite the ceasefire. There was no immediate response from Hezbollah.

Thousands head home as US-brokered truce holds in Lebanon

A fragile calm settled over parts of Lebanon on Friday as a 10-day ceasefire brokered by the United States took hold between Israel and Hezbollah, prompting thousands of displaced families to begin the journey home — even as uncertainty, destruction and Israeli warnings against going back to parts of southern Lebanon clouded their return.

By early morning, cars were backed up for kilometers on the route leading south to the damaged Qasmiyeh bridge over the Litani River, a key crossing linking the southern coastal city of Tyre to the north. Vehicles piled high with mattresses, suitcases and salvaged belongings crept forward through a single reopened lane, hastily repaired after an Israeli airstrike just a day earlier.

Drivers heading back to their villages along coastal highways cheered each other, flashed victory signs and exchanged blessings.

▶ Read more

Iranian media reports a challenge to the FM’s post declaring Strait of Hormuz open

Two semiofficial news agencies in Iran are casting doubt on an earlier announcement from Iran’s top diplomat, Abbas Araghchi, that the Strait of Hormuz was being opened to global traffic.

Considered close with the powerful Revolutionary Guard, Fars news agency appeared to challenge Iran’s reported decision to open the strait in a series of posts on its X account.

The posts condemned a “strange silence from the Supreme National Security Council and the negotiating team.”

Iran’s Supreme National Security Council has recently acted as the de facto top decision-making body in the country, as doubts swirl over the status of the new supreme leader, Mojtaba Khamenei, who was reportedly injured early in the war.

Mehr news agency also has said that the reported decision to reopen the strategic waterway needed “clarification” and “requires the (Supreme) Leader’s approval.”

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About 300 flights per day must be cut from the schedule at Chicago O’Hare International Airport on the busiest days this summer in an effort to reduce flight delays, federal officials announced Thursday.

“If you book a ticket, we want you and your family to have the certainty that you’ll fly without endless delays and cancellations,” Transportation Secretary Sean Duffy said in a statement.

O’Hare has the most number of flights of any U.S. airport, and it already had one of the worst records for flight delays nationwide last year.

More than 3,080 flights were planned on peak days this summer, which represented a 14.9% increase from the summer before, according to the U.S. Department of Transportation and Federal Aviation Administration. That increase comes as air traffic controllers deal with taxiway closures for construction projects.

In its draft order, the federal government said both American and United announced expansion plans at O’Hare that could lead to significant delays this summer and limit the airfield’s ability to handle the expected amount of traffic.

Duffy said that the schedule was unrealistic and would have exceeded what the airport could handle. So the number of flights at the airport will be limited to a maximum of 2,708, which is still slightly higher than maximum of 2,680 flights that were scheduled at the peak of last summer. He said that “will reduce delays and make this busy summer travel season a little easier.”

On slower days of the week, fewer flights will have to be cut because a smaller number was scheduled in the first place. Tuesdays, Wednesdays and Saturdays are typically slower days of the week for flights.

The flight limits will take effect May 17 and last through Oct. 24.

Airlines will go through the details of the order to figure out how many flights they have to cancel and then will notify customers.

American Airlines said that once implemented, the FAA’s order will improve reliability and reduce delays for customers traveling through O’Hare this summer.

“We are grateful to Secretary Duffy, Administrator Bedford, and their leadership teams for acting swiftly to ensure that Chicagoans and all consumers continue to benefit from sensible competition and to help minimize flight disruptions during the busy summer season,” American said in a statement.

American told employees in a memo that it estimates that it will have to cut no more than 40 arrivals and departures per day, but it estimates that United might have to cut more than 200 arrivals and departures based on the published schedules. United did not provide an estimate of how many flights it will have to cut.

United said the airline appreciates that the government came up with “a solution that makes sense for everyone who cares about O’Hare’s success.”

Both airlines will review the order and their scheduled to determine where to make cuts and then notify travelers who are affected.

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Associated Press Transportation Writer Josh Funk contributed to this report from Omaha, Nebraska.

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The Trump administration has agreed to resume funding a key Manhattan subway project after New York officials sued.

The U.S. Department of Transportation said in a federal court filing Thursday that it has completed its review of the Second Avenue subway line project, and will begin reimbursing state transit officials again for construction costs.

Janno Lieber, MTA’s CEO, said the reversal means “long-awaited transit justice” will soon come to neighborhoods in upper reaches of Manhattan. The Second Avenue subway project is building new stations northward along Manhattan’s Upper East Side, bringing subway service to parts of the Harlem neighborhood.

“It shouldn’t have taken seven months and a lawsuit to get here,” he said in a statement.

The federal Department of Transportation said the agreement means taxpayers’ “hard-earned dollars will not fund unconstitutional DEI initiatives,” referring to diversity, equity, and inclusion principles. The administration argued that use of DEI principles has led to soaring costs on federal projects and is unconstitutional.

“This has always been about securing the best deal for the American taxpayer and ensuring their dollars are spent efficiently and fairly,” the agency said in a statement.

Lieber, addressing reporters later Thursday, called the dispute “an “unnecessary waste of the public’s time and money” since the state agency was complying with the administration’s new rules regarding minority and women-owned businesses in federal projects.

“The whole point was they sent us a letter saying we didn’t make the standards of the new rules before they even issued the new rules,” he said. “It was just a bunch of gamesmanship.”

The USDOT had withheld roughly $60 million from the Second Avenue project as it launched its review. Overall, the project is supposed to cost $7.7 billion, with the federal government covering around $3.4 billion.

The dispute over the Second Avenue subway was among a number of major transportation projects in New York and New Jersey that Trump has sought to scuttle as he feuded with Democratic leaders in those states.

The administration in October also halted billions of dollars in funding for a massive new rail tunnel between New York and New Jersey. A federal judge in February, however, ordered federal officials to resume payments for the tunnel project under the Hudson River.

Last year, the USDOT rescinded approval for New York’s first-in-the-nation congestion fee and threatened to pull funding from the state if it did not abandon the toll, which is imposed on drivers entering the busiest part of Manhattan.

But a federal judge ruled last month that the agency lacked the authority to unilaterally rescind approval of the $9 fee.

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Brandi Carter needs her wine.

As the owner of Levure Bottle Shop in Jackson, Mississippi, she sells natural wine delivered to her business by a state agency responsible for distributing alcoholic beverages to liquor stores, bars and restaurants. But delays caused by problems in a state warehouse have led Carter and many other retailers to see their inventory dwindle and their business drop as they wait for new shipments.

Carter, who also handles the beverage program for a restaurant in Jackson, said she has been dealing with delays since February, and she’s feeling helpless as traffic in her store goes down.

“I’ve just reached acceptance that this is our new normal, and it’s awful,” Carter said Wednesday.

The state is the only distributor of liquor in Mississippi

In Mississippi, the state’s Alcoholic Beverage Control department — an arm of the Mississippi Department of Revenue — is responsible for distributing wine and liquor to businesses that sell it. That’s different than other states, where individual companies handle alcohol distribution, Carter said.

During the week ending April 12, there were more than 172,000 cases that were pending delivery, and it was taking an average of 17 days for businesses to receive their orders, according to the Mississippi Department of Revenue.

Those numbers are down from the week ending March 1, when the backup appeared to be at its peak for the year. At that time, there were more than 220,000 cases pending delivery, and it was taking an average of 25 days for the process to be completed.

In contrast, the number of cases pending delivery was more than 51,000 and the wait time was three days for the week ending Jan. 11., the department said.

Carter said the backlog has resulted in a wait of four to five weeks, as opposed to a few days to two weeks before the delays began.

Warehouse issues caused the delay

Shipping delays from the state’s 40-year-old warehouse emerged in January as it went away from an “obsolete” conveyor belt system to one where pallets were used to move cases, according to a statement from the Mississippi Department of Revenue. A new warehouse management system experienced technical issues, leading to delays, the department said.

“The computer program that they implemented for the warehouse wasn’t working effectively with the ordering side,” Carter said. “So the first big chunk was the biggest problem, because things were being marked as shipped, but they weren’t shipped.”

The department said technical issues have been resolved and the warehouse is operating at full capacity, with pending orders being shipped as retail orders increase.

“While capacity at the existing facility has been a challenge for well over five years, there is not an alcohol shortage,” the department said. “As retail ordering stabilizes, we anticipate shipments returning to normal volume within the coming weeks.”

Lawmakers thought about changing the system

The Mississippi legislature debated temporarily allowing out-of-state distributors to sell and ship alcohol directly to retailers. The law would have been repealed after two years, but it did not pass. The state’s legislative session has since ended.

A new warehouse set to be completed by the end of this year will be able to store and ship over twice as many cases as the current facility, the revenue department said.

Retailers, customers stymied by the backlog

Josh Sorrell, owner of Spillway Wine and Spirits in Brandon, said he used to order 600 cases in a day, but he is now limited to 100 cases per day. About 30% to 40% of the items he usually orders on a daily basis have been unavailable, he said.

Sorrell believes restoring the conveyor belt system would fix the problem. He has asked Mississippi Gov. Tate Reeves to declare a state of emergency.

If delays continue, Sorrell’s concerned that business will suffer into the end of the year, when he makes a lot of his sales.

“As it gets busier, we’re gonna crumble,” he said. “I mean, it’s going to be really hard at 100 cases a day to stock up for a full October, November, December.”

Meanwhile, customers are going to three or four stores looking for their specific bottle, and they sometimes can’t find it, Sorrell said.

“It’s frustrating to lose people at the door who are looking for a specific product that I can’t even get from the state,” he said.

On Thursday, Lauren Roberts went to Sorrell’s store looking for Soda Jerk’s orange cream shots, but he was out, just like the supermarket where she usually buys it. So, she bought another type of drink for an upcoming celebration with her family.

“We’re having a little get-together this weekend because it’s my daughter’s prom and her boyfriend’s family’s coming,” Roberts said. “So everybody has their drink of choice, but me.”

______

Sainz reported from Memphis, Tennessee.

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In early 2024, a former defensive tackle at the University of Alabama put on makeup and a wig and got on a video call from a swanky suburban Atlanta hotel to finalize a $4 million loan.

Luther Davis had convinced investors the money was for a player in the NFL, and he used the wig and make up to impersonate the athlete. The ruse worked.

The detailed allegations are included in a criminal complaint filed against Davis last month by the U.S. Attorney’s Office in Atlanta.

Federal prosecutors say Davis would go on to don disguises — a wig once, and a do-rag-style head covering another time — again in March and July to impersonate two other NFL players on video calls and bilk millions more in loans. The complaint does not say exactly how the wigs and do-rag helped Davis assume the three different players’ identities.

It also only identifies the NFL players by their initials.

Davis and CJ Evins, who prosecutors say executed the scheme with Davis, are charged with one count each of conspiracy to commit wire fraud and aggravated identity theft. They both pleaded not guilty in March, but they are scheduled to return to court on April 27 to enter a guilty plea, according to court filings.

An email and call to Davis’ attorney, Gabe Banks, were not immediately returned. Evins’ attorney, Benjamin Alper, confirmed his client is scheduled to plead guilty, but he said he had no additional comment.

The complaint says none of the NFL players had authorized Davis and Evins to obtain loans. In addition to wearing disguises, prosecutors say Davis used fake driver’s licenses with photos of the players that could be found online.

The scheme brought in nearly $20 million from at least 13 fraudulent loans that Davis and Evins used to buy real estate, jewelry and cars, according to the complaint.

Davis was a national champion with the Crimson Tide in 2010.

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Lawyers for President Donald Trump are engaged in talks with the IRS to resolve a $10 billion lawsuit the president filed against his own tax collection agency over the leak of his tax information to news outlets between 2018 and 2020.

In a federal court filing Friday, Trump asks a judge to pause the case for 90 days while the two sides work to reach a settlement or resolution.

“This limited pause will neither prejudice the parties nor delay ultimate resolution,” the filing says. “Rather, the extension will promote judicial economy and allow the Parties to explore avenues that could narrow or resolve the issues efficiently.”

Tax and ethics experts say the lawsuit raises a plethora of legal and ethical questions, including the propriety of the leader of the executive branch pursuing scorched-earth litigation against the very government he oversees.

Earlier this year, Trump filed a lawsuit in a Florida federal court, alleging that a previous leak of his and the Trump Organization’s confidential tax records caused “reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing.”

The president’s sons, Donald Trump Jr. and Eric Trump, are also plaintiffs in the suit.

In 2024, former IRS contractor Charles Edward Littlejohn, of Washington, D.C. — who worked for Booz Allen Hamilton, a defense and national security tech firm — was sentenced to five years in prison after pleading guilty to leaking tax information about President Trump and others to two news outlets between 2018 and 2020.

The outlets were not named in the charging documents, but the description and time frame align with stories about Trump’s tax returns in The New York Times and reporting about wealthy Americans’ taxes in the nonprofit investigative journalism organization ProPublica. The 2020 New York Times report found Trump paid $750 in federal income tax the year he first entered the White House, and no income tax at all some years, thanks to reported colossal losses.

When asked in February how he would handle any potential damages from the case, Trump said, “I think what we’ll do is do something for charity.”

“We could make it a substantial amount,” he said at the time. “Nobody would care because it’s going to go to numerous very good charities.”

Several ethics watchdog groups have filed friend-of-the-court briefs challenging the president’s lawsuit.

The watchdog group Democracy Forward’s February filing states that the case is “extraordinary because the President controls both sides of the litigation, which raises the prospect of collusive litigation tactics,” and “the conflicts of interest make it uncertain whether the Department of Justice will zealously defend the public fisc in the same way that it has against other plaintiffs claiming damages for related events.”

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Sky-high ticket prices won’t be the only thing emptying the wallets of soccer fans attending World Cup matches at some U.S. venues this spring.

Fans trying to get to MetLife Stadium from New York City can expect to shell out $150 for a round-trip train fare for each match, transportation officials confirmed Friday.

That’s nearly 12 times the regular $12.90 fare for the roughly 15-minute, 9-mile (14-kilometer) ride from Manhattan’s Penn Station to the stadium in East Rutherford, New Jersey. On-site parking won’t be available for most fans, so New Jersey officials anticipate that around 40,000 fans will use mass transit for each match.

The home stadium for both the NFL’s New York Giants and New York Jets is set to host eight World Cup matches, including the tournament final on July 19. Group stage matches for soccer powerhouses Brazil, France, Germany and England, along with other nations, begin June 13.

New Jersey officials said the upcharge was necessary to cover the cost of hosting the World Cup on its return to the U.S. for the first time since 1994.

NJ Transit officials said they planned to spend $62 million transporting fans to and from the stadium over the duration of the tournament. Outside grants had defrayed only $14 million of those anticipated expenses. A fare increase was needed to cover the rest, according to NJ Transit President and CEO Kris Kolluri.

“This isn’t price gouging,” he told reporters Friday. “We’re literally trying to recoup our costs.”

Gov. Mikie Sherrill, a Democrat, called on FIFA, international soccer’s governing body, to cover the transportation costs.

“If it won’t, we will not be subsidizing World Cup ticket holders on the backs of New Jerseyans who rely on NJ TRANSIT every day,” she said in a statement.

But FIFA has bristled at the suggestion that it should shoulder New Jersey’s transit costs. On Friday, it pointed to other U.S. host cities, including Los Angeles, Dallas and Houston, that are keeping their transit rates unchanged.

Transit prices in Boston also will be high

One notable exception is Boston, where express buses from various locations to Gillette Stadium, home of the NFL’s New England Patriots, will cost $95, officials announced this week.

Thousands of fans have also already snapped up $80 round-trip train tickets from the Massachusetts capital to the commuter rail station near the stadium, which is located in Foxborough, a town some 30 miles (48 kilometers) from Boston. That’s four times the $20 riders are normally charged for a round-trip ticket during game days and other special events at Gillette.

Meanwhile in Los Angeles, one-way fares will remain $1.75; in Atlanta, they’re locked at $2.50; in Houston, a single ride will still cost $1.25 and in Philadelphia the base fare for the subway will remain $2.90. Kansas City is running shuttles from locations around the city to Arrowhead Stadium that cost just $15 round trip.

Some of those cities have noted that the U.S. government has provided some $100 million in transit grants to provide enhanced bus and rail service during the games.

FIFA says fare hike ‘unprecedented’

The soccer federation on Friday warned that New Jersey’s transit pricing could have a “chilling effect.”

It argued that no other global event has been asked to absorb the costs of “arbitrarily set” transit prices and noted that the agreements signed with World Cup host cities back in 2018 called for free transportation for fans to all matches.

“Elevated fares inevitably push fans toward alternative transportation options,” FIFA said in a statement. “This increases concerns of congestion, late arrivals, and creates broader ripple effects that ultimately diminish the economic benefit and lasting legacy the entire region stands to gain from hosting the World Cup.”

The huge fare increase has also drawn protest from New York Gov. Kathy Hochul.

“Charging over $100 for a short train ride sounds awfully high to me,” the Democrat posted on X earlier this week. The surge pricing was first reported by sports outlet The Athletic.

Few other options

Alternatives to taking the train to MetLife Stadium will also be pricey.

Shuttle buses with a capacity for about 10,000 riders will set off from the midtown Manhattan bus terminal and other locations for $80 roundtrip.

Some 5,000 parking spots at the nearby American Dream Mall are also being sold in advance, currently priced at $225.

MetLife Stadium has a huge parking lot, but for World Cup matches much of that space is being used for a fan village, shuttle buses, a staging area and FIFA staff, officials said.

When the stadium hosted the NFL’s Super Bowl under similar conditions in 2014, New Jersey Transit struggled to accommodate an estimated 33,000 passengers leaving the game. Platforms at a train transfer station became jammed with passengers unable to get space on trains. Some waited for hours to get on board.

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AP Sports Writer Mark Long in Gainesville, Florida, contributed to this report.

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It could hardly have escaped notice in the White House, and even more so in the Kremlin, that the Iran War has provided an enormous windfall to Russia — raising oil prices, eliminating sanctions on Russian oil sales, creating new tensions within NATO, and preoccupying American strategic attention and forces.

Lest Putin seize upon these developments as an opportunity to intensify his aggression against Ukraine (which is highly likely given his recent behavior) and feel even more emboldened not to negotiate a constructive outcome, this would be an ideal moment for President Trump to move boldly to disabuse him of such notions.

The president has a fondness for associating himself with “doctrines” of highly regarded predecessors.

President Trump has drawn on and endorsed the Monroe Doctrine — rebranded as the “Donroe Doctrine” — to project American power and influence in our hemisphere. The Donroe Doctrine demonstrated that invoking a historic foreign policy framework — and updating it to contemporary circumstances — can be a force multiplier for American leadership. It rallied domestic support, signaled resolve to adversaries, and provided a clear picture of American intentions in the Western Hemisphere. Europe now needs the same clarity.

That clarity has a name: the Truman Doctrine. Current circumstances in Europe provide the president with not just an opportunity but an urgent need to associate himself with this historic American foreign policy framework as well — one purpose-built for exactly the kind of Russian aggression now unfolding.

Doing so would be a vivid and compelling demonstration that the U.S. is not being diverted by the Iran War from countering Russia’s war of aggression in Ukraine. It would, appropriately, underscore that the U.S. — even while engaged in the Iran War — continues to value NATO and recognizes Russia as a longer-term strategic threat to American and global interests.

Russia continues to attempt to undermine NATO, destabilize Europe, threaten its smaller neighbors, and position itself to dominate the Arctic. It seeks to weaken international controls on nuclear weapons, use cyber to threaten our infrastructure, undermine and manipulate American and other Western elections, and engage in massive information warfare.

Truman’s powerful message to what was then the Soviet Union was contained in a speech delivered before a Joint Session of Congress in March 1947. At that time, the Soviets were occupying several countries in East and Central Europe, and half of Germany. The KGB Soviet security services were undermining governments in others. Yet because the Soviet Union was a major ally in WWII, many Americans — including high-ranking officials who remained from the Roosevelt Administration — argued that the U.S. could “work with” Stalin to convince him to allow democracy in the countries he occupied and TO withdraw his troops. (There are advocates of similar sentiments in Washington today — suggesting that a fair peace in Ukraine and other constructive steps can be produced by “working with” Putin.)

Truman was convinced that Stalin had no such intentions, that his military was poised to take additional territory, and that the Soviet security services would undermine governments of additional countries such as Greece and Turkey.

Truman insisted that the softer America was in dealing with the Soviets, the bolder the Kremlin would be. It was in America’s security interests, he believed, to resist Soviet efforts to sustain and increase their military presence and political influence.

“I believe,” Truman declared before Congress, “that it must be the policy of the United States to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures.” He received a standing ovation on both sides of the aisle and bipartisan Congressional support for substantial resources to back him up.

This is a compelling moment to revive the Truman Doctrine. While the world has changed enormously since 1947, and Europe now is assuming most of the financial burden for its own security as well as for supporting Ukraine, the Kremlin remains defiant. It consistently undermines American and European efforts to achieve a just peace in Ukraine and represents a longer-term threat to other countries in the region. It still appears to have an appetite for sustained aggression. And it constantly throws out reminders that it remains a nuclear power.

Moreover, there is considerable evidence, and there are numerous disturbing reports by our closest allies, that Russia has provided Iran with intelligence to target U.S. weapons and bases that house large numbers of American troops. In one particularly egregious case, Iranian missiles and drones attacked and damaged a vitally strategic American AWACS plane at a Saudi base.

Clearly, the efforts made by the U.S. so far have had little deterrent effect and have not moved Putin toward constructive policies in Ukraine or the region. And Washington officials, in public at least, seem nonchalant about Russian actions that endanger American lives in the Gulf. Perhaps this will be the last straw demonstrating the need for bold U.S. leadership in dealing with Russia of the kind exhibited by Truman decades ago.

Even the most compelling “doctrine” will not have a decisive impact without robust armed support. But it can provide a strong rationale and moral foundation for that support. The muscle behind the Monroe Doctrine came not from America’s Navy — we barely had one at the time. It came from the British Royal Navy; Britain shared America’s interest in preventing Spanish recolonization of Latin America and extinguishing their new democracies. The Donroe Doctrine, therefore, derived its force not from American doctrine alone, but from support of A partner who shared the same interests. Allies were deemed important then, and Monroe knew it. Trump should know it too.

Reviving the Truman Doctrine would be a strong signal of American resolve in Ukraine and elsewhere — the more so if it were backed with substantially increased military support for Ukraine to further degrade the oil infrastructure that finances Russia’s war as well as to enhance sales of longer-range weapons for Ukraine. Just as the Donroe Doctrine secured America’s backyard, a revived Truman Doctrine — call it what you will — must now secure Europe and the broader democratic world.

President Trump has already endorsed one historic doctrine in our hemisphere. The Iran War and Putin’s opportunism demand that he do the same for Europe. The architecture is familiar. The precedent is his own. The moment is now.

Strong leadership based on strong principles could mobilize greater public and political support in the U.S. and elsewhere for confronting Russian aggression in Ukraine and security threats in other parts of the world. The Truman Doctrine made a consequential mark in history by standing up to Moscow’s threat to democratic nations decades ago. Giving it new life now would demonstrate a willingness to draw on its principles and resolve to confront a challenge likely to face the U.S. and the world long after the Iran war ends.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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As this year’s State of the Union made clear, President Trump places manufacturing — and tariffs — at the center of his economic agenda. Even with the Supreme Court striking down the IEEPA tariffs, other tariffs, including Section 232 tariffs on steel and aluminum, are here to stay. In fact, last week the United States Trade Representative announced the initiation of its first investigation under Section 301 of the Trade Act of 1974 with the stated aim of replacing the IEEPA tariff regime.

President Trump’s goal of ushering in the greatest manufacturing era in American history remains intact, but the fatal flaw of the administration’s current tariff strategy is that it is making it more expensive to manufacture in America.

Trump allies, including Oren Cass at American Compass, argue that tariffs and reshoring are essential to securing supply chains and rebuilding America’s manufacturing base. Cass recently told the Financial Times that tariffs are strategic levers to restore industrial capacity. Michael Lind, in his essay “So What If Tariffs Are Taxes?”, portrays tariffs as a public good that can reassert national control over markets. Robert Lighthizer, Trump’s former trade representative, defends tariffs as central to safeguarding U.S. manufacturing. These arguments carry populist appeal, but they falter when confronted with the economics of manufacturing and the realities of global supply chains.

Cass and Lind suggest that reshoring can be accomplished swiftly. But the equipment manufacturing industry, which I advocate on behalf of, demonstrates otherwise. Supply chains are vast, intricate, and global. Companies operate on multi-year investment cycles, and suppliers cannot be uprooted overnight. Attempting to force rapid reshoring risks bottlenecks, shortages, and inefficiencies that weaken U.S. equipment manufacturers rather than strengthen them. The Trump administration has wisely provided glide paths for industries facing regulatory changes; reshoring requires similar patience, not blunt instruments.

Tariffs, meanwhile, raise the cost of U.S. manufacturing. Steel and aluminum tariffs, along with levies on derivative components, have already inflated input costs for American equipment manufacturers. The United States is already the highest-cost producer of heavy equipment globally, and additional tariffs only exacerbate this disadvantage. Cass and Lind argue that tariffs level the playing field, but in practice they make U.S.-made equipment less competitive both at home and abroad. Lighthizer’s defense of tariffs as a bulwark against globalization ignores a fundamental reality: higher costs erode competitiveness.

Export competitiveness suffers as well. Higher input costs make U.S. goods less attractive in foreign markets, forcing manufacturers to either absorb losses or relocate production abroad to remain competitive. This dynamic undermines the President’s vision of global manufacturing leadership and his claim to be the “Affordability President.” Cass, Lind, and Lighthizer frame tariffs as tools to reduce deficits, but in practice they risk expanding them by driving production offshore.

Even if reshoring could be swiftly accomplished through tariffs — a premise many economists dispute — expanding domestic manufacturing capacity runs into a more fundamental constraint: the nation’s workforce. The U.S. manufacturing sector is already struggling to fill open positions. As of late 2025, between 394,000 and 449,000 manufacturing jobs remain unfilled nationwide, according to U.S. Department of Labor and Federal Reserve data. In equipment manufacturing specifically, vacancies remain high, with more than 85,000 job openings. A Deloitte study forecasts a shortfall of 2.1 million manufacturing workers by 2030 — a gap large enough to cost the U.S. economy as much as $1 trillion in lost output.

This looming deficit is driven in part by accelerating retirements among Baby Boomers and Generation X, who make up a disproportionate share of today’s skilled industrial workforce. Compounding the challenge, current and anticipated immigration policies are shrinking the pool of available workers at precisely the moment labor demand is rising. With immigration now the primary driver of growth in the working-age population, these declines significantly constrain labor supply across industrial sectors. It will take far more than tariffs to rebuild domestic manufacturing. Meaningful increases in workforce availability — through training, retention, workforce participation strategies, and immigration reforms — are essential before the U.S. can fill today’s job openings, let alone the additional labor required to support large-scale reshoring.

President Trump’s vision of industrial strength can be realized through investment in innovation, workforce development, and critical new infrastructure. Advanced manufacturing technologies, automation, and national energy dominance can give U.S. equipment manufacturers a decisive edge. Expanding apprenticeships, vocational training, and STEM education will ensure a skilled and growing workforce ready for modern industry. Modernizing ports, rail, and digital infrastructure will reduce logistical costs and enhance supply chain efficiency. Strategic partnerships with allies can diversify supply chains without resorting to blunt tariffs. These measures align with President Trump’s goals while avoiding the pitfalls of Cass, Lind, and Lighthizer’s protectionism.

President Trump is right to champion manufacturing as the backbone of American strength. But tariffs and forced reshoring are costly detours. Global supply chains cannot be redirected overnight. Tariffs raise input costs, and higher costs erode American competitiveness domestically and abroad. Cass, Lind, and Lighthizer offer patriotic rhetoric, but their solutions undermine the very industries they seek to protect. To truly make American manufacturing great again, the administration should double down on building strength through competitiveness, not barriers.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Yuling Luo rang the Nasdaq closing bell Friday having taken his first company public in a massively oversubscribed round. The Alamar Biosciences CEO’s IPO was one of two back-to-back blockbuster biotech offerings this week, a clear signal that investors are willing to open their wallets for life sciences companies again—under the right conditions.

On Thursday, Kailera Therapeutics, an obesity drug developer, raised $625 million in what is believed to be the largest biotech IPO in Nasdaq history. The IPO priced 39.1 million shares at $16 (the top of its range). The company had initially set out to raise just $500 million. One day post-IPO, Kailera was already up 63 percent.

On Friday, Alamar Biosciences, a precision proteomics (the study of proteins rather than genes) firm, priced its own upsized offering at $17 per share (the top of its range) raising $191.3 million after demand exceeded available shares by 11 times, Luo told Fortune. Much like Kailera, Alamar shares soared, up 33% on the first day of trading. 

For Alamar in particular, the listing carries symbolic weight. The life sciences tools and diagnostics sector has been effectively shut out of the public markets since 2021, when 

MedTech IPO activity peaked at 61 companies going public. A brutal stretch followed: Only two U.S. MedTech companies went public in each of 2022 and 2023, according to FLG Partners data. The tools sub-sector, where Alamar operates, has remained dormant.

Luo attributed the IPO drought—and Alamar’s ability to end it—to a long-awaited technological breakthrough in early disease detection of cancer and Alzheimer’s. The company’s platform can detect disease signals in blood that are too faint for existing tools to pick up. He compared the product’s detection capabilities as being able to read an eye exam chart from 37 miles away. 

“I think that’s why it’s been five years, because investors now see the great potential in proteomics. Everyone recognizes we finally have technology that could unlock it,” Luo told Fortune. He sees proteomics as the next frontier after genomics: where gene-sequencing gives doctors a static snapshot of a patient’s DNA, protein analysis offers a real-time window into how disease is actually unfolding inside the body. 

Alamar operates in a market valued at over $36 billion in 2025 and expected to reach $65.8 billion by 2030. The company tripled revenue from $25 million to $74 million in two years despite what Luo called “one of the most difficult market environments” for the tools industry.

Kailera is staking its claim in an even hotter opportunity and space: the global obesity GLP-1 market, currently worth roughly $10 billion and projected to reach $66.57 billion by 2035, growing at a 23% CAGR. The company is going head-to-head with Novo Nordisk and Eli Lilly, developing injectable and oral GLP-1 agonists.

The back-to-back pricings arrive at a complicated moment for biotech more broadly. Private bio/pharma funding in 2025 totaled roughly $40 billion across 1,045 deals, essentially flat with 2024. Meanwhile, the overall venture market has been dominated by AI. About 80% of global venture capital in Q1 2026 flowed to AI companies, with four mega-deals (OpenAI, Anthropic, xAI, and Waymo) accounting for more than $188 billion of the record $300 billion quarter. That dynamic has squeezed attention and capital for non-AI sectors, even as PitchBook data showed biotech deal activity climbing back to its highest level since late 2022 in Q4 2025.

The broader IPO market has struggled to find its footing too: early 2026 listings were “much slower than was expected,” Crunchbase research lead Gené Teare previously told Fortune, with attention consumed by AI giants like OpenAI, SpaceX, and Anthropic that have yet to list. When they do, Teare said, it could “create a lot of energy in the markets for other companies to also go out”—or simply crowd everyone else out. 

Analysts had projected 30 to 35 biotech IPOs for 2026. This week’s deals suggest the window may finally be cracking open—at least for companies with late-stage data and differentiated science to show investors.

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Men are nearly twice as likely as women to be living with their parents, and a new study says it’s particularly harmful for non-college educated men, who are less likely to hold jobs compared to their college-educated counterparts.

As rents have surged across the country, more and more men are moving home, and once there, many stop working. In fact, one in six non-college men (16%) now live with their parents, compared to 8% of college-educated men. A new working paper from Gabrielle Penrose, a graduate student fellow at the American Institute for Boys and Men, follows six decades of U.S. Census data and draws a direct line between rising housing costs and the decline of male labor force participation.

“There are very real economic forces that are limiting the options for non-college-educated men in the United States,” Penrose told Fortune. “Some of what we’re seeing is simply rational responses to a system that’s pricing them out.”

Since 1960, real rents in the United States have risen 150%. Over that same period, wages for men without college degrees have barely moved, thanks to automation, globalization, and the collapse of manufacturing. Penrose’s paper details that when rents rise, more Americans are forced back into the parental home. Men move home at nearly twice the rate of women. And non-college-educated men who end up there, the data shows, are increasingly dropping out of the workforce altogether.

For Scott Winship, a senior fellow and the director of the Center on Opportunity and Social Mobility at the American Enterprise Institute (AEI), the issue is doubly concerning because non-college-educated men may face more disadvantages today than what they would have experienced in the ’60s when Penrose first started looking.

“Today, there are many fewer non-college men than there were a generation ago, and so we should absolutely be concerned about non-college-educated men today,” Winship told Fortune. “They are a more disadvantaged group than they were in previous generations, just because the share of young adults with a bachelor’s degree is up to 40% or so now, versus in the past, when it was much lower. And so that makes me worry.”

Higher rents are forcing people back home

A 10% increase in local rents raises the likelihood that a non-college-educated man moves in with his parents by 1.1 percentage points. Penrose used geographic constraints like mountains, coastlines, and lakes as a research instrument in her paper and found that in areas where terrain limits construction and squeezes housing supply, costs are higher for reasons entirely unrelated to local wages or job prospects.

“In some areas, housing costs are higher not because people are earning more and driving up prices, but because there are limits to supply, because of geography: lakes, coastlines,” she said. “Housing is just more expensive there simply because it’s harder to build there.”

“It would be surprising if cities with higher housing costs didn’t have more men living at home just because, almost by definition, they’re less affordable,” said Winship, who has studied men’s earnings over time at the AEI.

Simultaneously, the environment is almost enabling it, her paper says. Baby boomer parents, sitting on significant housing wealth, are better positioned than ever to absorb adult children. “Providing for your adult children when they’re priced out of the housing market is kind of a ‘normal good,’ as economists call it, something people spend more on as they get richer,” Penrose said. “Parents are earning more and their sons are earning less.”

The data backs it up, according to Brandi Snowden, the National Association of REALTORS’ Director of Member and Consumer Survey Research. “Baby Boomers continued to make up the largest share of recent home buyers,” she told Fortune while referring to NAR’s 2026 Generation Trends report that showed a quarter of Boomers purchased multi-generational home recently. “This allowed them to care for aging parents or relatives, and accommodate adult children that may be moving back into their house, or who have never left. “

The share of men between 25 and 45 living with their parents has nearly doubled since the 1960s, from 7% to 12% today. Women’s rate has also risen, but remains flat at 7%. And the reason the effect falls harder on men than women comes down largely to children. When Penrose isolates women without college degrees who don’t have children at home, their patterns begin to mirror men’s almost exactly.

“When I look at women without a college degree who do not have children, their labor force participation and their rates of living with parents start to look much more like these men,” she said. “The difference is young children.”

Non-college men at home aren’t working

The most consequential finding in Penrose’s paper is what happens after men move in. Men living with their parents are 20 percentage points less likely to be in the labor force than those living independently. That same 10% rent increase is associated with a 0.5 percentage point decline in labor force participation. Initial estimates suggest housing costs could explain roughly a third of the total employment decline among non-college men.

“That’s not too surprising to me, just because if you’re looking at adults in their 20s or even 30s who are living at home, you’re looking at sort of the most disadvantaged guys in their cohort,” said Winship of Penrose’s findings. “So it makes sense that they’ve got other barriers to finding work, to keeping work—and that they’d be more likely to permanently drop out of the workforce.”

One in five non-college men in their early 30s live with their parents, and the rate remains elevated into their 40s, with roughly 14% at age 40. Among non-working men at home, a quarter have never held a job at all, up from one in five in 1980.

“Some of the pushback I was getting is people saying, ‘Maybe men are using it as a launchpad,’” Penrose said. “That doesn’t seem to be the case. These men who are living with their parents are completely detached from the labor market.”

Zoning restrictions and limits on construction don’t just make cities expensive, they inadvertently suppress workforce participation among the men least equipped to absorb the cost. “Policies that restrict housing construction inadvertently weaken labor force participation by raising the price of independence,” Penrose wrote in the report.

“When we think about housing policy, maybe we’re just thinking about affordability, but it’s also about getting people in the position where they’re able to access the labor market,” she said. “Policies that would make housing cheaper in cities like New York should increase participation for men, particularly men without college degrees.”

Winship agreed with Penrose’s point, saying high cost of living cities like New York and San Francisco are often where people can find more job opportunities—but it comes with the double-edged sword of higher rents.

“It points to a real villain in the story, which is just these land use regulations and zoning that constrain how much housing can be built,” Winship said. “Unfortunately, it’s often the cities that are most economically dynamic and have a lot of amenities, that are actually better at promoting upward mobility, that have these problems with zoning. So that’s definitely an area where policymakers should take a look.”

The hidden factor of marriage

Women, for the third time ever in history, now outnumber men in the workforce. And as women earn more than their male counterparts, they perform more labor at home. Winship echoed previous reports of a growing distancing from traditional values of marriage as a major reason for this phenomenon.

“I think, sort of the sleeper issue, is the decline in marriage. In the past, a lot of these younger men and working class men would have been married, and therefore they could have tolerated higher housing costs without having to move back home,” Winship said. “But because marriage has declined so much, you have a lot of single men, especially among young adults, and more so among working class adults. And when housing is expensive, they’re much more likely to find that financially burdensome than in the past. I think that is kind of underlying a lot of the findings of the paper.”

“If you’re a young man looking at the situation, you don’t see in the future that you’re going to need to be responsible for a family,” he concluded. “And they don’t really know what their role is in this new world where they’re not going to be the primary breadwinner. And so that pushes towards working less and potentially living at home with their parents. I think marriage really is the sleeper issue here.”

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The Trump administration’s grand plan to fix America’s housing affordability crisis leans heavily on deregulation, and Wall Street is increasingly unified in its skepticism that it will actually work.

In a new research note published Thursday, UBS analysts assessed the Economic Report of the President, which laid out the administration’s most detailed housing strategy to date and found that the U.S. is short roughly 10 million homes, even higher than UBS’s own estimate of approximately 7 million units. The verdict: well-intentioned, directionally right in places, but unlikely to provide the “adrenaline shot” the housing market needs heading into the midterms.

The administration’s central argument is that government regulation — what the White House calls a “bureaucrat tax” — is the primary culprit behind the nation’s housing affordability crisis, and that the burden adds more than $100,000 to the cost of a single-family home. The administration estimates that a one-standard-deviation decline in the Wharton Residential Land Use Regulatory Index could increase the U.S. housing stock by 13.2 million units.

To prove the concept is achievable, the White House pointed to Texas in the early 2000s, when looser land-use rules and rapid suburban expansion enabled home prices to remain stable even as its population surged.

The problem is that the model eventually produced overheated prices — and a boom-bust cycle that Texas is still working through. Fortune‘s Lance Lambert reported in 2022 that Austin had become overvalued by 41% and Dallas by 33%. By 2026, the correction has arrived: Austin home values have fallen more than 11% from their 2022 peak and the city now ranks 51st out of 52 large U.S. metros in housing market health, with Dallas down nearly 11% as well.

“While frothy home prices and negative demand shocks are key elements of boom-bust cycles, so is supply elasticity,” Lambert, currently the editor-in-chief of ResiClub, told Fortune. “The fact that markets like Austin, Punta Gorda, and Tampa have more available land that can be built on means they are more likely to see a supply response following overheating in home prices and rents.”

When demand surges in those markets, builders can ramp up construction relatively quickly. But when demand cools, the additional supply coming online can amplify downside pressure on prices and rents.

The flip side, Lambert noted, is that supply-constrained markets like those in the Northeast or coastal California tend to see less dramatic boom-bust swings precisely because of limited buildable land and lower levels of new construction.

In Texas, therefore, the administration is essentially citing a success story that became a cautionary tale — precisely the boom-bust volatility that deregulation alone, absent coordinated demand management, has historically failed to prevent.

None of that means deregulation is the wrong long-term prescription. “There isn’t a magic wand that will all of a sudden return housing affordability to its historic average tomorrow,” Lambert said. “It will take time for the recent deterioration to heal, and some markets will see it faster than others. That said, over the long term, if we make it easier to build in more markets, the faster supply may be able to respond to these cyclical spikes in housing demand — like we saw in 2020–2022 — and we’d have a healthier housing market.”

UBS analysts called the attempt to tackle housing from both a supply and demand perspective “encouraging.” The suggested best practices organized around unleashing manufacturing innovation, streamlining homebuilding stages, and protecting consumer choice also represent “a step in the right direction,” it added.

But the bank sees a fundamental structural problem: housing regulation in the United States is overwhelmingly controlled by local governments, not Washington. That means the administration’s guidelines are, at best, voluntary suggestions. So the states with the heaviest regulatory burdens, like California and New England, lean Democratic and “may prove less willing to abide” by the White House’s playbook.

This is not a new finding. In January, Morgan Stanley strategists characterized Trump’s housing directives as only “modestly helpful for homeowner affordability,” warning they amount to a marginal adjustment rather than a market cure. The real obstacle, Morgan Stanley concluded, is the “lock-in” effect: roughly two-thirds of all outstanding mortgages still carry interest rates below 5%, meaning homeowners have little financial incentive to sell no matter how much deregulation Washington pushes through. Apollo Global Management’s Torsten Slok noted that 40% of U.S. homes carry no mortgage at all, making the lock-in effect even deeper than mortgage data alone suggests.

Meanwhile, the housing market has been frozen for nearly three years, with the spring thaw that buyers keep hoping for repeatedly failing to materialize.

If the White House wants to move the needle quickly, UBS pointed to a more tractable lever: having Fannie Mae and Freddie Mac ramp up mortgage-backed securities purchases, or temporarily cutting the guarantee fees the two government-sponsored enterprises charge lenders. It’s the same mechanism the administration tried in January, briefly pushing the 30-year rate below 6% for the first time since 2022 before the effect faded.

There was one area where UBS expressed genuine enthusiasm: off-site and modular construction. Construction labor productivity declined roughly 30% between 1970 and 2020 — a drag the administration estimates has cost the U.S. economy about 20 basis points of GDP growth per year — while overall U.S. productivity rose by 100% over the same period. UBS estimates wall panelization alone could generate $6,200 in per-home cost savings at scale, 30% fewer framing days, and 20% less waste.

The administration’s report recommended aligning building codes for modular and prefabricated housing with national standards, which UBS called a potential catalyst for efficiency gains across the entire housing value chain.

Still, off-site construction is a years-long buildout, not a spring solution. For now, the gap between the administration’s housing ambitions and its available tools remains wide.

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One takeover attempt is bold. Two? Rare indeed. But when news broke in mid-April that the United CEO was interested in acquiring his rival American Airlines, it was the third time this maverick air exec decided he wanted to reshape the playing field. As Fortune reported earlier, it’s far from clear such a merger would ever be approved, and on Friday American said it was “not engaged with or interested in any discussions regarding a merger with United Airlines.” Still, sources that spoke to Fortune called it “not impossible” given a President who “loves big deals.” And it’s worth looking back at Kirby’s track record to understand that, when he sees a deal, he is serious.

Put simply, Kirby has a long history of audacious ideas. It was back in the early 2000s that he rose at America West to become the top lieutenant to CEO Doug Parker. In 2005, the pair orchestrated the offensive that devoured much bigger U.S. Airways from Chapter 11. In 2007, American’s current CEO Robert Isom joined U.S, Airways—America West took its target’s name—as chief operating officer and served alongside CEO Parker and president Kirby in what become known as an industry “dream team.” Kirby gained a reputation as one of the best in business at network planning and revenue management. Isom totally transformed the airline’s industry-trailing record in on-time performance baggage handling, and customer service so that within two years, U.S. Airways ranked among the industry’s best in each category.

In December of 2013, the braintrust reprised the David-beats-Golaith playbook when U.S. Airways snagged American from bankruptcy, and reflagged once again as the bigger name. Parker, Kirby and Isom continued as CEO, president and COO respectively, mounting a comeback that by the mid-2010s, got American’s stock back near the pre-GFC levels.

Parker made it clear that Kirby wouldn’t succeed him, and in 2016, United CEO Oscar Munoz pounced, hiring the 50-year old as president and heir apparent. Kirby built on Munoz’s success in going up-market, and burnished his credentials as a master of capturing high-fare business customers in the mold pioneered by Delta. “He’s the smartest person I’ve ever worked with,” says Jim Olson, who worked with Kirby at US Airways and United, heading communications at both companies. “He’s like an AI supercomputer in establishing routes, but he shows it even in funny ways. At US Airways, we had this contest at quarterly all-hands meetings where they’d put out this giant jar of jelly beans, and you’d win by getting closest to actual number of beans in the jar. Kirby just eyed it, and won, he was off by just a few jelly beans. He’s also extremely politically savvy, and employees love him.” (Olsen just published an acclaimed memoir and crisis management guide called “Tailwind: A Compass for turning your Setback Story into a Comeback Legacy” featuring a forward by Munoz that this highly writer highly recommends.)

Instead of following the United and Delta push for affluent flyers, American emphasized competing on price, even removing premium rows on its aircraft. The low fares didn’t support a top product, and the airline generated low yields on seats sold. American viewed its competition as low-cost carriers such as Spirit and Frontier. Its low profitability and high debt levels made the carrier super-vulnerable to the COVID shutdown, and to survive, it piled on gigantic levels of debt that hobble its finances to this day. Its current market cap stands at just over $8 billion, one-fourth and one-fifth the respective numbers for United’s and Delta. Given its giant size in revenues, that American harbors such a tiny valuation underlines that investors are extremely downbeat on its prospects.

So Kirby would be pursuing a hobbled American for the second time. On this occasion, he’s confronting the leader who was part of brainiac trio that performed the US Airways-American coup a decade ago, and now has the CEO job at his old employer. It won’t be an easy quest, that’s for sure. But given his track record, it’s not an impossible one either.

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John Kapon knew that the bottle of 1945 Domaine de la Romanée-Conti up for sale at his New-York based wine seller’s auction last month was going to do well. After all, it was one of only 600 bottles of the burgundy produced in a year marked in history as end of World War II, and considered one the greatest vintages of all time.

Still, it was a little shocking when the bottle sold for $812,500—setting a new world record for a bottle of wine sold at auction at nearly 50% more than the record price that same bottle had fetched in 2018. “Scarcity really drives the bus,” says Kapon. “When it comes to really rare, and really old wines among the greatest, people don’t really care what they pay for it.”

Wines are not the only category of collectible items seeing a surge in value at auction. Last month, the 1969 black Fender Stratocaster guitar that Pink Floyd member David Gilmour played on that band’s most iconic albums, including “Dark Side of the Moon,” went for $14.55 million at a Christie’s auction. That was more than double the $6 million record set in 2020 for a guitar, a 1959 Martin D-18E that Kurt Cobain played in Nirvana’s “MTV Unplugged” performance decades earlier. Only weeks before that, a rare Pokémon Pikachu Illustrator card, one of just 29 created for a competition in the 1990’s, was sold by influencer and wrestler Logan Paul for $16.5 billion—triple what he paid for it in 2021.

What those items have in common is they are very rare, one-of-a-kind items that also tell a story. In the case of the Domaine de la Romanée-Conti, with the passage of time, fewer and fewer bottles of the wine have become available, with perhaps only a handful left, estimates Kapon.

Acker’s Fine and Rare index, which tracks a cross-section of 100 top wines sold at the auction, rose 11% in the first three months of the year, one of the strongest jumps he’s seen in 25 years. Other collectibles are seeing effervescence at their higher end: TCGplayer, a platform owned by eBay for trading cards of all kinds, said it saw double‑ and triple‑digit percentage gains on many rarer cards in 2025. And the online music instrument marketplace Reverb found that in 2025, the overall values of an array of quality vintage instruments, not just the multimillion-dollar headline grabbing ones, had risen by 10% to 30% last year, with the rarer models fetching the biggest increases. The market for unique collectables stands in contrast to a slower-growing art market: The recent Art Basel and UBS Art Market report found the sector grew by a modest 4% last year, after a couple of years of declines.

Collecting prized and special objects is nothing new, of course. And it’s not just rarity that drives up prices at auction. It’s often a story that makes something a one-of-a-kind item—and therefore valuable. Of the Gilmour guitar, Christie’s Nathalie Ferneau explained, “It sort of became this mythical holy grail object.” The instrument was part of a Christie’s auction of the collection of Jim Irsay, a billionaire who had owned the Indiana Colts football team. The auction yielded over $84 million in sales from 44 items, setting 23 world records.

The guitar was modified by Gilmour himself, who changed the neck multiple times and drilled holes into it. Such changes would typically dent the value of an instrument, but not in this case, since the modifications show it was a guitar Gilmour himself tailored to get the sound he wanted on those classic albums. “For a true fan, that makes it all the more desirable,” says Ferneau.

In the case of the Pokémon card, much of its value stemmed from its pristine, original condition, certified by an authentication agency. It helped that Paul sweetened the pot by selling the card inside a custom necklace he wore, and that he would hand-deliver it to the winner.

Not every valuable collectible item is meant to be put in a display case or resold. Wine, for example, is meant for drinking. Similarly, guitar collectors like to get together with friends and actually play their prized possessions, rather than treat a multi-million dollar guitar like a Monet painting. “It’s a great conversation piece,” says Martin Nolan, executive director of auction house Julien’s, which in 2015 sold the first guitar to fetch $1 million.

Another possible factor in the rise of collectables: Truly unique pieces are a chance for the ultra-wealthy to flex amid the sea of sameness in high-end personal goods. “Traditional luxury goods are losing their luster,” says Columbia Business School marketing professor and former LVMH executive Silvia Bellezza. “The 1% disengages from this type of good, and so what do they do next? They’re not going to stop signaling. They’re going to do it in a more sophisticated way.”

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Oil prices dropped back to where they were in the early days of the Iran war, and U.S. stocks raced to another record Friday after Iran said the Strait of Hormuz is open again for commercial tankers carrying crude from the Persian Gulf to customers worldwide.

The S&P 500 leaped 1.2% to an all-time high and closed out a third straight week of big gains, its longest streak since Halloween. A freer flow of oil could take pressure off prices not only for gasoline but also for groceries and all kinds of other products that get moved by vehicles. It could even ultimately help people pay less on credit-card interest and mortgage bills.

The Dow Jones Industrial Average surged as many as 1,100 points before paring its gain to 868, or 1.8%. The Nasdaq composite climbed 1.5%.

The U.S. stock market has jumped more than 12% since hitting a bottom in late March on hopes the United States and Iran can avoid a worst-case scenario for the global economy despite their war. Friday’s reopening of the Strait of Hormuz, which may only be temporary, is the clearest signal yet for optimism, and President Donald Trump said late Thursday that the war “should be ending pretty soon.”

The price for a barrel of benchmark U.S. crude plunged immediately after Iran’s foreign minister, Abbas Araghchi, posted on X that passage for all commercial vessels through the strait “is declared completely open” as a ceasefire appears to be holding in Lebanon. He said it would stay open for the remaining period of the ceasefire, and the price for U.S. oil dropped 9.4% to settle at $82.59 per barrel.

Brent crude, the international standard, fell 9.1% to settle at $90.38 per barrel. To be sure, it remains above its $70 price from before the war, indicating some caution is still embedded in financial markets.

Several times since the war began, optimism on Wall Street has quickly deteriorated into doubt about a possible end to the fighting. That in turn has caused vicious and sudden swings of prices for everything from stocks to bonds to oil.

Minutes after the Iranian foreign minister’s announcement of the Strait of Hormuz’s reopening, Trump said on his social media network that the U.S. Navy’s blockade of Iranian ports remains “in full force” until both sides reach a deal on the war. He, though, also suggested that “should go very quickly in that most of the points are already negotiated” and emphasized it by using all capital letters.

Companies with big fuel bills soared to some of Wall Street’s biggest gains following the easing of oil prices.

United Airlines flew 7.1% higher, and Southwest Airlines climbed 5.1%. A day earlier, the head of the International Energy Agency had said that Europe has “maybe six weeks or so” of remaining jet fuel supplies.

Operators of cruise ships, which guzzle fuel, also steamed higher. Royal Caribbean Group gained 7.3%, and Carnival rose 7%.

Housing and auto-related companies likewise got some relief from the drop in oil prices.

With less threat of high inflation hurting the economy, a sustained drop in oil prices could convince the Federal Reserve to resume its cuts to interest rates to help the economy. The yield on the 10-year Treasury sank to 4.24% from 4.32% late Thursday, and lower yields can bring down rates for mortgages and other loans going to U.S. households and businesses.

Builders FirstSource, a supplier of windows and other products, rose 5.5%, and homebuilder PulteGroup gained 5% on hopes that lower mortgage rates will spur more people to buy houses. Carvana climbed 7% because lower loan rates can get more customers into new autos.

A strong start to the earnings reporting season for big U.S. companies has also helped support the U.S. stock market, and more financial companies joined the list delivering bigger profits for the start of 2026 than analysts expected.

State Street rose 2.5%, and Fifth Third Bancorp added 1.7% after both reported better results for the latest quarter than expected.

They helped offset a 9.7% slide for Netflix, which fell even though it delivered a better profit than expected. It did not raise its forecast for revenue growth for the full year, which analysts said may have disappointed some investors.

It also said Reed Hastings, cofounder and chairman of the streaming company, will step down from its board of directors in June when his term expires.

All told, the S&P 500 rose 84.78 points to 7,126.06. The Dow Jones Industrial Average jumped 868.71 to 49,447.43, and the Nasdaq composite climbed 365.78 to 24,468.48.

In stock markets abroad, stock indexes leaped in Europe following Iran’s announcement about the Strait of Hormuz. France’s CAC 40 jumped 2%, and Germany’s DAX returned 2.3%.

In Asia, where trading finished for the day before the announcement, indexes were weaker. Japan’s Nikkei 225 lost 1.8%, and Hong Kong’s Hang Seng fell 0.9% for two of the bigger losses.

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AP Business Writers Chan Ho-him and Matt Ott contributed to this report.

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White House chief of staff Susie Wiles plans to sound out Anthropic CEO Dario Amodei about the artificial intelligence company’s new Mythos model, which has attracted attention from the federal government for how it could transform national security and the economy.

A White House official, who requested anonymity to discuss the planned meeting Friday, said the administration is engaging with advanced AI labs about their models and the security of software. The official stressed that any new technology that might be used by the federal government would require a technical period for evaluation.

The meeting comes after tensions have run hot between the Trump administration and the safety-conscious Anthropic, which has sought to put guardrails on the development of AI to minimize any potential risks and maximize its economic and national security benefits for the U.S.

President Donald Trump tried to stop all federal agencies from using Anthropic’s chatbot Claude over the company’s contract dispute with the Pentagon, with Trump saying in a February social media post that the administration “will not do business with them again!”

Defense Secretary Pete Hegseth also sought to declare Anthropic a supply chain risk, an unprecedented move against a U.S. company that Anthropic has challenged in two federal courts. The company said it wanted assurance the Pentagon would not use its technology in fully autonomous weapons and the surveillance of Americans. Hegseth said the company must allow for any uses the Pentagon deemed lawful.

U.S. District Judge Rita Lin issued a ruling in March that blocked the enforcement of Trump’s social media directive ordering all federal agencies to stop using Anthropic products.

Anthropic declined to speak about the meeting in advance.

The San Francisco-based Anthropic has said the new Mythos model it announced on April 7 is so “strikingly capable” that it is limiting its use to select customers because of its ability to surpass human cybersecurity experts in finding and exploiting computer vulnerabilities.

And while some industry experts have questioned whether Anthropic’s claims of too-powerful AI technology were a marketing ploy, even some of the company’s sharpest critics have suggested that Mythos might represent a further advancement in AI.

One influential Anthropic critic, David Sacks, who was the White House’s AI and crypto czar, said people should “take this seriously.”

“Anytime Anthropic is scaring people, you have to ask, ‘Is this a tactic? Is this part of their Chicken Little routine? Or is it real?’” Sacks said on the “All-In” podcast he co-hosts with other tech investors. “With cyber, I actually would give them credit in this case and say this is more on the real side.”

Sacks said, “It just makes sense that as the coding models become more and more capable, they are more capable at finding bugs. That means they’re more capable at finding vulnerabilities. That means they’re more capable at stringing together multiple vulnerabilities and creating an exploit.”

The model’s potential benefits, as well as its risks, have also attracted attention outside the U.S.

The United Kingdom’s AI Security Institute said it evaluated the new model and found it a “step up” over previous models, which were already rapidly improving.

“Mythos Preview can exploit systems with weak security posture, and it is likely that more models with these capabilities will be developed,” the institute said in a report.

Anthropic has also been in talks with the European Union about its AI models, including advanced models that haven’t yet been released in Europe, European Commission spokesman Thomas Regnier said Friday.

Axios first reported the scheduled meeting between Wiles and Amodei.

When it announced Mythos, Anthropic said it was also forming an initiative called Project Glasswing, bringing together tech giants such as Amazon, Apple, Google and Microsoft, along with other companies like JPMorgan Chase, in hopes of securing the world’s critical software from “severe” fallout that the new model could pose to public safety, national security and the economy.

“We’re releasing it to a subset of some of the world’s most important companies and organizations so they can use this to find vulnerabilities,” said the Anthropic co-founder and policy chief, Jack Clark, at this week’s Semafor World Economy conference.

Clark added that Mythos, while ahead of the curve, is not a “special model.”

“There will be other systems just like this in a few months from other companies, and in a year to a year-and-a-half later, there will be open-weight models from China that have these capabilities,” he said. So the world is going to have to get ready for more powerful systems that are going to exist within it.”

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O’Brien reported from Providence, R.I. AP business reporter Kelvin Chan contributed to this report from London.

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The U.S. and Iran have observed a cease-fire for nearly two weeks, but the economic toll is only starting to become clear and could have drastic consequences.

The U.S.-Israeli bombardment has damaged more than 125,000 residential and civilian buildings, while over 20,000 industrial units have been destroyed, according to Hadi Kahalzadeh, a former economist at Iran’s Social Security Organization writing for the Bourse & Bazaar Foundation.

“If this war had a hidden target, it was not Iran’s military power projection; it was the labor market that sustains the livelihoods of ordinary citizens,” he said in Substack post on Sunday.

Kahalzadeh added Iran’s ports and transportation systems have also been heavily damaged, while more than $300 billion in civilian infrastructure is estimated to have suffered damage.

In the process, supply chains, transport networks, and commercial services have been disrupted, forcing many companies to suspend operations.

But the pattern of strikes appears to have targeted the core pillars of Iran’s labor market, namely steel, construction, petrochemicals, pharmaceuticals, and retail, he pointed out.

Steel, in particular, is especially critical as supplies ripple through manufacturing, transportation, and construction, Kahalzadeh wrote.

The war’s other knock-on effects, including 72% inflation in March, weak demand, low liquidity, falling incomes, and deep uncertainty have hit wholesalers and retailers as well. After tallying up the impact on various sectors, the result is stark.

“Considering the pattern of attacks, about 10 [million] to 12 million jobs, roughly 50% of Iran’s workforce, are now at risk,” Kahalzadeh estimated. “That does not mean all of those jobs have already disappeared. It means that a very large share of Iranian workers now live under the shadow of furloughs or layoffs.”

To be sure, the U.S. and Israel have said they are targeting Iran’s defense industrial base that supports production of its missiles and drones. That has included some plants that serve both military and nonmilitary purposes.

Meanwhile, air strikes have largely avoided Iran’s energy infrastructure, though Israel attacked a fuel depot near Tehran as well as the massive South Pars gas field and nearby Asaluyeh refinery.

Majid Saeedi/Getty Images

Kahalzadeh’s dire warning comes as the Iranian economy was already crumbling before the U.S. and Israel launched their war in late February.

Since then, inflation has worsened, the currency has collapsed further, and the regime faces a cash crunch that threatens its ability to pay government workers.

On top of that, the U.S. naval blockade on ships entering or leaving Iranian ports could trigger a currency devaluation spiral and hyperinflation.

President Donald Trump said Friday the blockade will remain, despite saying Iran had agreed to fully open the Strait of Hormuz.

In fact, the Pentagon said earlier this week that the blockade would be expanded to include “shadow fleet” tankers used by Iran to transport sanctioned oil, even if it means interdicting ships in the Pacific.

So while the bombs have gone quiet for now, the Iranian people and the regime face must climb out of an epic economic crater.

Kahalzadeh calculated if only 30% of the 10 million to 12 million jobs at risk are actually lost, that still translates to approximately 3 million to 4 million jobs—representing a 15% labor market contraction and the largest decline in Iran’s modern history.

With so many people out of work, the social safety net would be stretched to the brink, as war-induced unemployment would take up at least 20% Iran’s budget, which is already running a large deficit.

“Even if the cease-fire holds, Iran’s most vulnerable people will suffer the long-term consequences of this 40-day conflict,” he added. “The bitter irony of this war is that the very population President Trump claimed to support by this war is now bearing the brunt of the damage.”

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German Enlightenment philosopher Immanuel Kant argued in his 1795 essay Perpetual Peace: A Philosophical Sketch, that nations should conduct themselves in a particular way with wars and debt: “National debts shall not be contracted with a view to the external friction of states.”

In other words, to maintain peace, don’t finance wars with debt.

Nearly a quarter-millennium later, public finance expert Linda Bilmes warns the U.S. is making this exact mistake in how the U.S. is raising capital for the Iran war, encumbering the already weighty $39 trillion national debt.

According to Bilmes, a policy lecturer at the Harvard Kennedy School, the cost of the ongoing war is likely to exceed $1 trillion, swamping early projections of U.S. spending on the war, with the Pentagon reportedly claiming the first week of the war cost about $11.3 billion alone. The American Enterprise Institute estimated the costs of the war would have exceeded $35 billion by April 1—or about $1 billion per day. Bilmes said the daily costs are double those estimates, as the government does not take into account the long-term impacts of war, such as long-term veteran disability benefits and damage to key infrastructure that could take years to rebuild.

Above all else, Bilmes noted, the U.S. is now relying more heavily on debt to finance the war that we have previously. During the wars in Iraq and Afghanistan in the early 2000s, the debt held by the public sat at around $4 trillion, and we were paying about 7% of the overall federal budget on interest, Bilmes said. Today, $31 trillion of debt is held by the public, with 15% of the national budget being spent on paying down interest.

“The result is that the interest costs alone will add billions of dollars to the total cost of this war,” Bilmes said in a recent interview with the Harvard Kennedy School. “And unlike the upfront costs, these are costs we are explicitly passing on to the next generation.”

Bilmes told Fortune that the U.S. didn’t always put so much burden on the national debt during wartime, although each previous conflict did rely on borrowing money. These 21st century wartime funding strategies furthered by the Trump administration, she said, are bad news for the U.S ‘s mounting debt.

U.S. history of financing wars

An adolescent United States tried to follow Kant’s peace principles when it entered the War of 1812, implementing a slew of duties, including direct land taxes, as well as taxes on everything from sugar, auction sales, carriages, liquor distilleries, and retail alcohol licenses. This was perhaps more by necessity than choice: The Bank of the United States’ charter ran out in 1811, meaning there was no centralized entity able to manage loans and bonds.

The wartime heavy taxes essentially laid the groundwork for how the U.S. would raise capital in times of war, from the Civil War through Vietnam, though the bunk of financing still came from borrowed money. 

During World War I, for example, President Woodrow Wilson espoused a “conscription of wealth,” telling Americans that just as the U.S. drafted young men to fight the war, it would also draft the wealth of America’s richest. By 1918, progressive income tax rates touched 77%. In the throes of the Korean War, President Harry Truman gave more than 200 speeches advocating for his “pay-as-you-go policy” of using tax revenue to pay for military expenditures over debt.

But this ideology changed at the turn of the 21st century, when President George W. Bush implemented tax cuts in 2001 and 2003 at the same time as he launched attacks on Iraq and Afghanistan, becoming the first time a U.S. war was funded solely through borrowing rather than taxes or budget increases. Bilmes, along with economist Joseph Stiglitz, published a study in 2006 that found the true cost of the war in Iraq and Afghanistan topped $2 trillion, about four times greater than the Congressional Budget Office (CBO)’s projected $500 billion in direct spending. In 2013, Bilmes revised her estimations — and concluded the cost was actually closer to $4 trillion to $6 trillion.

The impact of broken traditions

President Donald Trump has continued this pattern in Iran today. The administration’s “One Big Beautiful Bill Act” extended Trump’s 2017 tax cuts, lowering rates for individuals and businesses. The cuts will total $4.5 trillion in tax reductions over the next 10 years, according to the act. 

Meanwhile, the White House is seeking up to $100 billion in additional funds for the conflict from Congress, the Washington Post reported, and Trump’s fiscal 2027 budget request called for $1.5 trillion in defense spending, a 44% increase from the year before and also includes a 10% cut to nondefense spending. The proposed budget would mark the first time defense spending exceeds all other discretionary spend. About a quarter of the U.S. budget comes from borrowed money.

“That is money that goes on indefinitely,” she said. “It means that every year the base that you start from in the budget is higher.”

Bilmes argues there’s nothing inherently wrong with borrowing money. Rather, she’s concerned the administration’s focus on military spending will come at the expense of investments in economic growth, tipping the debt-to-GDP ratio and leading to a drag on economic growth.  The White House did not immediately respond to Fortune’s request for comment.

“When you borrow for things that are productive investments, like infrastructure or education, you hope to get back more than what you borrow,” she said. “But in this case, we’re borrowing high rates, largely for things that will end up in the sand.”

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Iran and the White House both declared the valuable Strait of Hormuz chokepoint “completely open” on April 17, and benchmark crude oil prices plunged below $90 per barrel for the first time since early March. But Iran is still asserting its control over the strait and President Donald Trump maintained that the U.S. blockade on Iranian ports continues for now.

Translation: Virtually nothing has changed yet, and the markets overreacted to the announcements, although peace talks are seemingly making notable progress, energy and geopolitical analysts told Fortune.

“The strait remains closed for now,” said Matt Reed, vice president of geopolitical and energy consultancy Foreign Reports. “The Iranians made clear that nothing has really changed yet. They still want ships to follow their orders. That means being rerouted. It means maybe paying tolls.

“When Iran said that the strait was completely open, it came with an asterisk.”

Despite the confusion on Friday, Reed said, there is clear progress being made in the negotiations.

“If there if there is a breakthrough to be had, it might not be for a few more days,” Reed said. “We are clearly inching in the right direction, but there’s still a long way to go. The problem for oil markets is that every day the strait remains shut the market is starved. And it is still closed for now.”

Historic supply shocks

The world has continued to suffer its greatest supply shock ever for nearly seven weeks with the closure of the strait and the halting of roughly 20% of global crude oil, liquefied natural gas, fertilizer, and petrochemical trade flow.

Although Trump declared the strait “completely open and ready for business and full passage,” he emphasized that the naval blockade on Iran’s exports will remain “in full force and effect” until a peace deal is “100% complete.” He said the process should be completed “very quickly” because most points are already negotiated. Trump added that Iran is in the process of removing sea mines from the strait, which has not been confirmed.

No immediate changes in traffic through the Persian Gulf were apparent April 17, said Claire Jungman, director of maritime risk and intelligence for Vortexa. “In practical terms, that likely means shipowners, charterers, and insurers will still want operational clarity before changing voyage decisions.”

German maritime shipper Hapag-Lloyd still has six vessels stuck in the Persian Gulf. The company’s crisis committee is meeting and trying to determine when it might be safe to traverse the strait, said spokesman Nils Haupt in email exchanges. But they remain in a holding pattern for now.

“There are still some open questions on our end, but they might be resolved within the next 24 hours,” Haupt said. “Top priority for the passage is safety and security for the seafarers, the vessel, and the cargo of our customers. If all open issues are cleared (i.e. insurance coverage, clear orders of Iranian government/military about the exact sea corridor to be used, and the sequence of ships leaving), we would prefer to pass the strait as soon as possible.”

Likewise, the Norwegian Shipowners’ Association said the tenuous situation “remains unresolved” with issues of sea mines, Iran’s conditional orders, insurance, and more still unclear for now.

It seems as if the Israel-Lebanon ceasefire announced April 16 was a key step toward moving the U.S. and Iran closer on a potential deal. Iran drew a line in the sand against Israel continuing to bomb Lebanon. Trump said the reopening of the Strait of Hormuz is not tied to Lebanon, but Trump added on social media, “Israel will not be bombing Lebanon any longer. They are PROHIBITED from doing so by the U.S.A. Enough is enough!!!”

Matt Reed now sees an interim peace deal—not a more in-depth permanent one—as possible as soon as this weekend.

“The good news is that we’re headed in the right direction. The bad news is that we haven’t achieved a breakthrough yet,” Reed said. “We could see Iran ease its grip on traffic going through the strait, but it won’t want to give up its leverage too soon.”

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The U.S. is caught in a spiraling debt crisis, and a major casualty might be demand for U.S. Treasuries—a critical support pillar for the economy and the government’s ability to spend money.

The scale of U.S. borrowing is severely testing confidence in the country’s ability to keep financing itself. The federal debt has climbed to $39 trillion, a level that budget experts have warned might soon force the U.S. into increasingly dire decisions as to what it can spend on. 

One victim of such a spiral would be the Treasury market, the largest bond market in the world. The country’s nagging debt problem is starting to break down that longstanding reliability of Treasury securities, and could eventually cause their demand to collapse, according to Henry Paulson, who served as Treasury secretary during the George W. Bush administration. 

“That’s a dangerous thing,” he said Thursday during an interview with Bloomberg TV, describing a scenario where demand and prices for Treasuries fall as foreign interest in the market declines.

It’s no exaggeration to say Treasury securities underpin multiple parts of the global financial system, and are foundational to the way the U.S. government finances itself. The government is able to offset its gaping deficit by issuing Treasury securities, including bonds, bills, and notes, which are then purchased by a wide range of investors including foreign governments and pension funds.

Demand for securities is what informs Treasury yields, which serve as a benchmark for virtually every other borrowing cost ranging from mortgage rates to student loans. When yields rise, those costs rise with them. 

The Treasury market is also a haven asset. In times of crisis, investors around the world have historically piled into U.S. government debt precisely because it is considered the safest store of value on the planet. Ever-present international demand for U.S. government bonds have played a big role in turning the dollar into the world’s reserve currency, and are a big reason why the U.S. has been able to rack up such a large spending tab. 

That status, however, is not guaranteed. Escalating risk tied to the nation’s debt obligations could push investors to require higher yields on Treasuries, forcing interest rates up which would make the deficit even more difficult to resolve.

Should enough investors back out of buying Treasuries, the Federal Reserve would step in as a buyer of last resort, Paulson said, a dynamic that might accelerate the government’s debt spiral by further eroding confidence in the U.S. economy’s stability. 

He called for a last-resort measure to halt the spiral if the situation deteriorates to that point. “We need an emergency break-the-glass plan, which is targeted and short-term, on the shelf, so it’s ready to go when we hit the wall.” 

The Committee for a Responsible Federal Budget, a nonpartisan think tank, has advocated for something similar, recently proposing a plan that would allow the government to nimbly navigate its stressed budget the next time the economy enters a downturn.

As for when such a crisis might occur, Paulson said it would be hard to predict, depending on a variety of factors including the debt’s trajectory and the general state of the economy. But nearing that moment without a plan, he continued, would be a self-defeating exercise.

“It will be vicious,” he said. “We have to prepare for that eventuality.”

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If you look at Adam Silver’s background, you wouldn’t think he’d eventually come to lead the NBA, nor bring it to be the massive marketing and media powerhouse it is today.

The son of a labor lawyer, he grew up in Rye, New York, editing at his high school newspaper and running cross country. He studied political science at Duke University, clerked for a federal judge, and then made partner at a major New York law firm. None of that would have screamed sports mogul.

But in 1992, when he joined the NBA as a junior staffer under then-Commissioner David Stern, Silver quickly rose over a three-decade-plus career from special assistant to chief of staff, to president of NBA Entertainment and finally, deputy commissioner. It wasn’t until February 2014 that he was elected to be the league’s fifth commissioner.

Over the course of his 12-year tenure in the position, Silver brought the league back from what many fans initially saw as a fledging sport struggling to keep up with the growing viewership of the NFL and MLB. The hey-day of the entertainment era: (Dr. Jerry Buss screaming “Showtime!” after giving Paula Abdul her big start probably emphasizes this most prominently) from growing cross-country feuds to the sport taking on a global stage during the 1992 Olympics was largely seen as the height of the sport. Silver, learning from Stern who brought the league from a league where fans would tape delay the finals to a $5 billion-a-year global industry, took that leadership to another level.

And on Thursday night, we was awarded for that leadership: Silver became the first sports executive in the award’s 35-year history to receive the Edison Achievement Award. The honor, often called the “Oscars of Innovation,” places Silver alongside past recipients including Steve Jobs, Elon Musk, and Jensen Huang.

The Edison Achievement Award is presented annually to leaders who have made significant and lasting contributions to innovation and human-centered design. Silver received the award at a ceremony in Fort Myers, Fla. Rihanna was also honored this year.

“My role is to serve as a steward of the NBA–preserving the 80-year history and legacy of our league while helping to chart its future,” Silver told Fortune in an exclusive interview following his receiving of the award. “That requires constant collaboration and communication with all of our stakeholders.”

Since taking the helm as commissioner, Silver has overseen an era of aggressive expansion and reinvention. He presides over five professional leagues: the NBA, WNBA, NBA G League, NBA 2K League, and the Basketball Africa League. Last year, he secured landmark 11-year media rights deals with Disney, NBCUniversal, and Amazon worth a combined $76 billion.

“Basketball is truly a global sport and that’s been a major catalyst for the NBA and its continued growth and influence over the years,” Silver said.

Edison Awards CEO Frank Bonafilia called Silver a transformative figure.

“Adam Silver has not only upheld the NBA’s legacy as a premier global sports league but has boldly reinvented it for the 21st century,” Bonafilia said.

Reimagining the regular season

Among Silver’s most visible innovations are structural changes to the NBA calendar designed to raise the stakes of regular-season play. The NBA Cup, an in-season tournament now in its third year, and the Play-In Tournament, introduced during the 2020-21 season, were both launched under his watch.

“Competitions like the NBA Cup and the Play-In Tournament were designed to add more games of consequence and excitement during the regular season,” Silver said. “As a result, we’ve seen record fan interest—whether you look at viewership, attendance, or social media engagement.”

Silver has also pushed the NBA’s footprint into new markets, none more notable than Africa, where the Basketball Africa League launched in 2019 as a partnership between NBA Africa and the International Basketball Federation. The league now features 12 teams from across the continent.

“The NBA and the game of basketball have deep roots in Africa, which laid the groundwork for the creation of the Basketball Africa League,” Silver said. “Our focus is less about exporting the NBA product as it exists in North America and more about building a locally relevant league that is authentic to Africa.”

Silver’s vision extends to how fans consume the game. With the NBA’s new media partners, he’s betting on streaming technology and artificial intelligence to overhaul the broadcast experience.

“Working with our media partners, we’re focused on developing hyper-personalized and hyper-localized broadcasts that reimagine the live viewing experience for our fans,” Silver said. “Through streaming technology and artificial intelligence, we want to give fans the ability to experience the game exactly the way they want.”

Lessons from the Bubble and sports management

The Edison Award also nods to Silver’s leadership during the COVID-19 pandemic, when the NBA became the first major U.S. sports league to suspend its season in March 2020, and then pioneered the “NBA Bubble” at Walt Disney World to complete play. The Bubble has been seen as a case study of crisis management. Instead of cancelling the season or scrambling for alternatives way of playing the high-contact sport, Silver brainstormed the Bubble and it has largely been seen as a success, even when other leagues failed to replicate it.

“The experience of operating through a pandemic was a reminder that there will always be things outside of your control, no matter how prepared you are,” Silver said. “We tried to maintain a fact-based mindset, even as information around Covid was changing by the day. Through collaboration, communication, and compromise, the NBA community came together to create the ‘NBA Bubble’ and successfully complete our season.”

For Silver, the Edison honor carries a broader message about what innovation means in sports.

“A lot of what we consider innovation is about efficiency, convenience, and speed. Those things matter a lot,” Silver said. “But sports remind us that some of the most important forms of innovation are human— things like building trust, creating identity, and fostering belonging.”

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Iran’s foreign minister declared the Strait of Hormuz “completely open” for commercial shipping on Friday, sending Brent crude down roughly $10 to around $89 a barrel within minutes and U.S. stocks to a fresh record high.

President Donald Trump quickly claimed credit on Truth Social, writing that the Strait is “COMPLETELY OPEN AND READY FOR BUSINESS”—but he made clear the U.S. naval blockade of Iranian ports isn’t going anywhere until a deal with Iran is “100% COMPLETE.” He added that the negotiation process “SHOULD GO VERY QUICKLY” because most of the points have already been worked out.

Despite the strait opening, it’s unclear when commercial shippers will gain the confidence to resume normal operations. Some told the Wall Street Journal they were waiting for clearer security guarantees before resuming normal traffic, which before the war ran at around 135 vessels a day.

On the face of it, the reopening is the clearest sign yet that the two-month U.S.-Iran war is winding down. But the bigger story, according to veteran energy analysts, is the fresh leverage Iran discovered it holds in the Gulf.

“It turns out the Strait of Hormuz functions almost like a nuclear deterrent,” said Jim Krane, a Gulf energy expert at Rice University’s Baker Institute and the author of books on Saudi and UAE energy policy. “It’s a pretty strong card that they play, basically holding the global economy hostage to halt attacks on it.”

Roughly 20% of the world’s oil and a large share of liquefied natural gas transit the narrow strait. When Iran effectively closed it in February, the impact on the global economy was immediate; Asia and Europe faced blackouts and rationing, and fertilizer supplies tightened, threatening crop yields. Even Iraq—an Iranian ally—had to shutter oil production because it couldn’t move its gas, forcing its power grid into rolling outages, Krane said. 

That pressure is ultimately what forced Iran’s hand, Krane explained. “Iran can probably hang on for a while,” he noted, pointing out that Iranian oil exports have actually risen during the war thanks to cargoes already on the water. “But the pressure on the global economy was really just unsustainable.”

Friday’s euphoric price drop may be premature. Ed Morse, former longtime head of commodities research at Citigroup, told Fortune that the market is getting ahead of the physical reality. “The forward curves are pointing to, from a consumer perspective, optimism that’s not warranted by where the actual flows are,” Morse said.

The reality is that the markets cannot catch up fast enough to meet the dearth of oil. Morse claims roughly 10 million barrels a day of supply have been disrupted for 45 days. That missing supply from the global system is partly absorbed by demand destruction and by drawing down inventories that are now “extremely low,” Morse said. Other estimates have gone even higher, like the International Energy Agency putting the true daily toll at 20 million barrels per day. 

Even if the strait reopened fully overnight, it would take at least seven weeks for oil that left the Middle East before the war to reach Asia-Pacific markets. “There’s not going to be oil reaching their normal destinations for almost two months,” he said. “And that assumes you’ll get production back rapidly, and that you’ll get flows back rapidly, which I don’t think is going to happen.”

Iran has also said it placed mines in the Strait of Hormuz, using its knowledge of their locations as leverage by guiding select ships safely around them, allowing them to further thwart any attempts by ships to move through the strait without Iranian approval.

That’s one of two things that will stretch the timeline further, he added. Mine clearance in the strait—which Trump posted on Truth Social is happening with Iran’s cooperation—could take the better part of a month depending on cooperation. And ship owners, Morse said, are going to be extremely cautious about sending vessels back into the waterway. A VLCC—the largest class of crude tanker—costs about $120 million to $130 million. “You’re not going to risk losing your money machine,” Morse said.

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Last year was a record-breaking one for international tourism, injecting trillions of dollars into the global economy and supporting millions of jobs. But while more people than ever took to weathered streets of European capitals or sun-soaked beaches on Pacific islands, the U.S. appears to have plummeted down travelers’ bucket lists.

Global travel last year added a record $11.6 trillion to the economy, according to a report released this week by the World Travel & Tourism Council (WTTC), an industry body. Tourism’s worldwide value accounted for almost 10% of global GDP, and represented one of the fastest-growing economic sectors in Asia, Africa, and Latin America.

In the U.S., however, last year was a different story. North America ended the year as the slowest-growing region for tourism, with the industry’s economic value growing only 1% compared to 2024. That was almost entirely due to plunging international visits to the U.S. While international travel rose by 80 million people in 2025, visitors to the U.S. fell 5.5%. The latest data point illustrated the country’s declining international appeal, regardless of how long people intend to stay. 

Bad press for the U.S.

The report isn’t the first to document the declining interest in the U.S. as an international destination, which surveys have largely attributed to President Donald Trump’s policies. One analysis by Skift, a tourism-focused website, found 46% of travelers said they were less likely to visit the U.S. in 2025 because of Trump. The administration has tightened visa requirements, and nationals of dozens of countries have been barred entry to the U.S. altogether.

Most concerning to many would-be travelers was the administration’s immigration crackdown, which was accompanied by televised reports of violent clashes with law enforcement in several large American cities and typical tourist draws. European and Canadian visitors have been caught up in the president’s deportation campaign as well, likely discouraging more tourism. One German tourist crossing overland from Mexico into California last year was held in a detention center for six weeks, including a spell in solitary confinement.

Combined with Trump’s tariff regime, musings to invade Greenland, and a wide range of other enacted or planned policies—such as one proposal to force tourists to divulge their social media history before being granted access to the U.S.—the country’s international brand has taken a hit. 

The shift comes with real economic costs. A separate report released this week by the non-profit U.S. Travel Association found domestic and international travel supported 15 million jobs and generated $3 trillion in output last year, representing 2.4% of GDP. But that figure could have been even higher without the decline in international tourism. The WTTC estimated foreign tourists in the U.S. spent $176 billion last year, more than $14 billion less than in 2024.

A summer reprieve?

The U.S. remains the largest travel market in the world, largely due to the $1.5 trillion domestic tourists spend every year seeing the country. And the WTTC projected 2026 to be a different story for the U.S. as the country prepares to co-host the FIFA World Cup this summer, a monthlong-event involving 11 cities that could attract 1.24 million international visitors. 

The tournament is likely to generate billions in economic output in a relatively short period, according to a study earlier this month by the U.S. Travel Association. Each World Cup visitor from abroad expects to spend more than $5,000 during their stay, on average, the study found, nearly twice as much as international tourists usually spend.

But even a wildly successful World Cup month might be looked back upon as a regretful case of what-ifs. Experts have warned a long list of headaches could force tourists considering visiting the U.S. this summer to shorten their trip or cancel it entirely, including expensive match tickets, strict visa procedures, safety concerns, and rising airfares due to the war in the Middle East. Citing the recent reports showing the decline in international visitors to the U.S., some analysts have slightly downgraded their projections for tourist volume this summer.

An early indicator the U.S. might want to keep its expectations in check for the summer has been hotel prices. Rather than raising room rates as would normally happen during periods of expected high demand, hotels across the U.S. have started slashing prices for this summer, the FT reported this week, with some host cities seeing match-day rates tumble as much as one-third. Domestic tourists are a spending power in the U.S., but international visitors, who might stay longer and venture further afield, are sorely missed.

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Employers have regained their power over employees, and the effects are already showing up.

During the peak of the Great Resignation in November 2021, 4.5 million workers left their jobs voluntarily. As of last month, that number was about 3 million as employees hesitated to leave their jobs at a time when job searches can drag on for months. Workers’ optimism for finding a job is lower today than during the pandemic in 2020, according to a report by the Federal Reserve Bank of New York.

Data from the Federal Reserve Bank of New York found that workers were even less optimistic about finding a job today than they were in 2020. The average worker said they had less than a 50% chance of finding a job in today’s economy, according to the Fed data.

Even those who have a job are now having to deal with cuts to benefits and perks, if not mass layoffs, as AI advances and investors pressure companies to cut costs. Many are also forcing employees back to the office after years of flexible work and remote work policies. 

Employees who may not have tolerated such cuts in the past are now coping with them, according to a January survey from MyPerfectResume.

The survey of 1,000 adults found that only 7% of employees would quit their jobs over a mandatory return-to-office policy. That’s compared to 51% who said they would quit over the same issue in January of 2025. More than 70% of workers also predicted they would have the same or less bargaining power to push for flexible work policies in 2026 than in 2025, the survey found.

 “The era of employee leverage has ended,” Jasmine Escalera, a career expert at MyPerfectResume, said in a statement. 

Office mandates lead the way

One of the starkest reminders that the workplace has shifted is the change in companies’ approach to remote work. A report from last July by commercial real estate company Jones Lang LaSalle Inc. (JLL) found that Fortune 100 companies are forcing employees to work from the office an average of 3.8 days per workweek, compared with 2.6 days in 2023.

Some employers have gone even further, forcing employees to come into the office full-time and doing away with the flexible work policies of the pandemic era. 

One such company is Instagram, whose CEO, Adam Mosseri, told U.S. employees in a companywide memo in December that they would need to work from the office five days a week. Parent company Meta has required employees to come into the office three days a week since 2023.

Automaker Stellantis started requiring workers to come into the office five days a week starting last month. Meanwhile, Home Depot in January announced a five-day return to office for employees starting earlier this month, at the same time it announced 800 layoffs.

Even Microsoft, which, after the pandemic, instituted a flexible work policy that allowed most employees to work less than 50% of the week remotely without needing manager approval, began requiring their workers in the Puget Sound region to come into the office three days a week starting in February.

Benefits are quietly shrinking too

The rollbacks that companies are pushing in today’s economy have also extended to benefits and perks. In February, Home Depot imposed stricter requirements for employee bonuses. A manager must now reach at least 95% of their store’s sales goal to qualify for a bonus, up from 90% previously. At the same time, the retailer cut the amount paid out to those who reach only the minimum threshold. Those managers whose stores reached 95% of their sales goal, and no more, will receive 25% of their target bonus, down from 50% before. The changes come as the home improvement retailer fell short of analyst expectations with $38.2 billion in sales, down $1.5 billion year-over-year.

Meta, whose CEO, Mark Zuckerberg, has been one of the loudest voices calling for cost-cutting and efficiency, has reportedly scaled back some perks for workers in recent years. Some of these changes include eliminating free laundry and dry cleaning as well as pushing back the time dinner is served in the office, so employees have to stay later to take advantage of it. Goldman Sachs, for its part, cut its free breakfast and lunch options, according to the Wall Street Journal.

Why workers aren’t pushing back

Companies’ cuts to perks and benefits, as well as their push to get more out of employees, come as unemployment stood at 4.3% in March. Potentially as a result of higher unemployment and low hiring, the overall quit rate has stayed below 2% for eight consecutive months.

March exceeded analyst expectations with 178,000 jobs added, but just a month before, the U.S. economy lost 92,000 jobs, according to the Bureau of Labor Statistics. 

Nicholas Bloom, a Stanford economist whose research helped define the Great Resignation, told Fortune last month that workers should not leave their current job without another lined up. “You don’t want to quit a job to find that what you thought would be easy — getting another job — turns out to be a massive struggle,” he said.

AI adoption is adding another layer of pressure. While AI is saving employees up to an hour per day, according to Goldman Sachs, companies are quickly filling this time saved with extra tasks by demanding more output from each worker.

The risk employers are taking

Jamie Shapiro, an organizational psychologist and CEO of the executive coaching company ConnectedEC, told Fortune that while employers push for greater productivity, they may also be underestimating the long-term costs to employees and the company as a whole. 

This is especially true if cuts to benefits or perks are not doled out evenly, she said, and in such situations, employers need to ensure they communicate the reasons for the changes clearly.

“Anytime we have an abrasion of justice, we are going to see lower motivation of our employees because we want things to feel fair.”

The idea that squeezing workers harder produces more output, she argued, is a false narrative. 

“When we don’t invest in our people, and we don’t care for their well-being, we actually get so much less out of them.”

The Great Resignation showed that employees offered a better deal elsewhere don’t hesitate to move on. This is a problem for companies, especially when the average cost of turnover per employee is about 6 to 9 months of an employee’s salary, according to a study by the Society for Human Resource Management. 

Employees who are constantly worried about the next layoff or benefit cut are not going to be loyal to their employers or brag to their friends about their company, which can help recruitment and the company’s brand. 

Improving employees’ perception of the company as well as the amount of effort they contribute to an organization has everything to do with a company’s workplace culture, said Shapiro.

I have a thriving culture, I’m thriving within the culture, then what we see is that person’s going to be more committed to the organization, more willing to go above and beyond, talk about why it’s such a wonderful place to work, all of those things

“When I’m somebody who’s on the front line, do I feel like my organization is being fair to me? And if the answer is no, then that can hurt motivation, and it can hurt not only the culture, but it can also hurt how much I feel invested in the organization,” she said.

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President Donald Trump said Iran agreed to suspend its nuclear program indefinitely, and will not receive any frozen funds from the US.

Trump said in a phone interview on Friday that a deal to end the war, which the US and Israel began with Iran in late February, is mostly complete. Talks over a lasting agreement will “probably” be held this weekend, the president said. 

“Most of the main points are finalized. It’ll go pretty quickly,” Trump said.

Iran has yet to comment on any deal beyond the Strait of Hormuz opening, nor on claims made by Trump on Thursday that Tehran had offered concessions — including over the key issue of its nuclear program.Play Video

Oil, fuel and natural gas prices plunged on hopes that the latest developments would mean more energy supplies can finally transit safely through the strait.

Brent crude traded below $90 a barrel by 12:05 p.m. in New York and wiped out most of its gains since the onset of the war. Diesel prices in the US and Europe, which was hit severely by the war, led the move lower in the energy complex.

Trump said he hasn’t decided who would lead a US delegation for talks with Iranian officials to sign an agreement. Asked if he would travel to Pakistan, which hosted the last round of negotiations, the president said, “I may.” 

JD Vance led discussions with Iranian officials last weekend, and Trump said he was considering sending the vice president alongside his son-in-law, Jared Kushner, and envoy Steve Witkoff for the talks.

The president denied that the moratorium on Iran’s nuclear program would expire after 20 years. Asked if the program will completely halt, Trump responded “No years, unlimited.”

The situation in the vital Hormuz waterway remained uncertain Friday. The Islamic Republic earlier said it would open the strait for the duration of the 10-day ceasefire between Israel and Lebanon. 

Trump hailed that move, but indicated that a US blockade on vessels transiting to and from Iranian ports would remain in place until a broader deal between Washington and Tehran was “100%” agreed. 

Iran said through its semi-official Fars news agency that it will close the strait again if the blockade remains in place. Transiting vessels must coordinate with Iranian forces, semi-official Tasnim added. 

Many traders and analysts remain skeptical that flows can resume meaningfully and quickly as Iran is yet to confirm whether the strait would be open to all traffic beyond the ceasefire.

About a fifth of the world’s oil and liquefied natural gas flowed through the waterway before the war. Its effective shuttering for the duration of the conflict has stoked a global energy crisis and stoked fears of a worldwide slowdown and rampant inflation. 

The US imposed its own blockade on Monday, while Iran has repeatedly said it wants to maintain control of the strait in the longer term and is working on legislation to charge tolls. 

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Dario Amodei warned last May that AI could wipe out half of entry-level white collar jobs. Microsoft AI chief Mustafa Suleyman predicted the technology would automate most tasks of the entire white-collar workforce in a year to 18 months. And recently, a report from Anthropic mapped out exactly what Suleyman warned about, and what Elon Musk thinks will make work optional.

The successive statements about AI’s transformative impact on labor may help justify the booming valuation of some AI companies. But this rhetoric in part is also behind some backlash to the technology. A recent NBC News poll found just 26% of U.S. voters have a positive view of the technology, while 46% have a negative view. Now, OpenAI chief global affairs officer Chris Lehane is warning people to relent on messaging around AI.

“Some of the conversation out there is not necessarily responsible,” he told The San Francisco Standard. “And when you put some of those thoughts and ideas out there, they do have consequences.”

“This is not fun and games,” he added. “This is really serious s–t.” 

The constant drumbeat of promises of AI’s labor market impact, as well as the threat of raising electricity bills and the danger it poses to kids, has a growing number of Americans rejecting the technology. And in recent weeks, backlash to the technology has turned violent.

Last week, a 20-year-old man named Daniel Moreno-Gama traveled from his home in Texas to San Francisco and allegedly lobbed a Molotov cocktail at the gate of OpenAI CEO Sam Altman’s home. Authorities then found a manifesto from Moreno-Gama warning of humanity’s extinction at the hands of AI, which included a threat of murder. Reactions to the attack across social platforms like Instagram and TikTok suggest the sentiment runs deep. Comments like “He’s not scared enough” and “FREE THAT MAN HE DID NOTHING WRONG” or “Finally some good news on my feed” reveal a widespread fear of the technology, at least across the internet.

The incident follows a separate shooting at an Indiana city councilman’s house after the councilman expressed support for a data center project in his district. The councilman said the perpetrator shot 13 bullets into the home and left a “no data centers” sign at the doorstep.

What to do about the current discourse surrounding AI

For Lehane, it’s about emphasizing the positives of the technology. “Our job at OpenAI and in the AI space—and we need to do a much better job—is to explain to people why…this is going to be really good for them, for their families and for society writ large,” he said.

Of course, the AI optimists are already singing the praises of the technology. Some have that in just a few years, we’ll be working a three-day work week and lounging at the beach as AI agents do our work for us.

“You have one group that effectively says, ‘This is going to be the greatest thing ever, everyone’s going to be living in beachside homes, painting in watercolors as they while away their days,’” Lehane said. “And then you have another extreme, which I would call the Doomers, who have a very, very negative and dark view of humanity.” 

The data so far supports some of Lehane’s skepticism about the extreme predictions. A study published in February by the National Bureau of Economic Research found that out of 6,000 CEOs and other executives, the vast majority have seen little impact from AI on their operations. That’s even as about two-thirds of executives reported using AI. And while some tech companies have initiated mass layoffs due to AI automation, including Jack Dorsey’s Block, and most recently, Snap, the technology’s impact on the labor market has yet to appear in macro data. In March, employers posted 178,000 job gains and the unemployment rate ticked down to 4.3%, suggesting job gains, at least in the short term, have outweighed AI-related layoffs.

“You’ve had a series of things that have been put out there—but haven’t come to fruition—about extreme things that are going to happen,” Lehane said.

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Iran said Friday it fully reopened the Strait of Hormuz to commercial vessels, but President Donald Trump said the American blockade on Iranian ships and ports “will remain in full force” until Tehran reaches a deal with the U.S., including on its nuclear program.

Iranian Foreign Minister Abbas Araghchi posted on X that the crucial waterway, through which about 20% of the world’s oil is shipped, was now fully open to commercial vessels, as a 10-day truce between Israel and the Iran-backed Hezbollah militant group in Lebanon appeared to hold.

Trump initially celebrated the Iranian announcement, posting on social media that the strait was “fully open and ready for full passage.” But minutes later, he issued another post saying the U.S. Navy’s blockade would continue “UNTIL SUCH TIME AS OUR TRANSACTION WITH IRAN IS 100% COMPLETE.”

The president also said Iran, with help from the U.S., is working to remove all mines from the strait.

Trump imposed the blockade earlier this week after Iran restricted traffic through the strait due to fighting in Lebanon, which Iran claimed to be a breach of the Pakistan-brokered ceasefire reached between the U.S., Israel and Iran.

At the time, Trump said the blockade would enforce an “all or none” policy in hopes of pressuring Iran to reopen the strait.

The president’s decision to continue the blockade despite Iran’s announcement appeared aimed at sustaining pressure on Tehran as the fate of the two-week ceasefire reached last week remains uncertain. Direct talks between the U.S. and Iran last weekend were inconclusive, as the two nations differed over Iran’s nuclear program and other points.

Truce in Lebanon could help US-Iran peace efforts

Oil prices fell on hopes of a deal. The head of the International Energy Agency had warned that energy shocks could get worse if the strait did not reopen.

The truce in Lebanon could clear one major obstacle to a deal between Iran, the United States and Israel to end weeks of devastating war. But it was unclear to what extent Hezbollah would abide by a deal it did not play a role in negotiating and which will leave Israeli troops occupying a stretch of southern Lebanon.

Trump said in another post that Israel is “prohibited” by the U.S. from further strikes on Lebanon and that “enough is enough” in the Israel-Hezbollah war. The White House did not immediately respond to a question about whether the prohibition spans both offensive and defensive strikes.

Shortly before Trump’s social media post, Israeli Prime Minister Benjamin Netanyahu said Israel agreed to the ceasefire in Lebanon “at the request of my friend President Trump,” but that the campaign against Hezbollah is not complete.

He claimed Israel had destroyed about 90% of Hezbollah’s missile and rocket stockpiles and added that Israeli forces “have not finished yet” with the dismantling of the group.

Celebrations in Beirut

In Beirut, celebratory gunshots rang out across the Lebanese capital at the start of the truce. Displaced families began moving toward southern Lebanon and Beirut’s southern suburbs despite warnings by officials not to return to their homes until it became clear whether the ceasefire would hold.

A spokesperson for the U.N. peacekeepers in southern Lebanon said Friday they had not observed any airstrikes since midnight, but accused the Israeli military of violating airspace and of artillery shelling in southern Lebanon. The Israeli military did not immediately comment.

According to the agreement shared by the State Department, Israel can act in self-defense against imminent attacks but cannot carry out offensive operations against southern Lebanon.

Trump heralded the deal a “historic day for Lebanon” and expressed confidence the war with Iran would soon end.

“I will say the war in Iran is going along swimmingly,” Trump said in a Las Vegas speech. “It should be ending pretty soon.”

An end to Israel’s war with Hezbollah was a key demand of Iranian negotiators, who previously accused Israel of breaking the current ceasefire with strikes on Lebanon. Israel said that deal did not cover Lebanon.

Pakistan’s army chief met Thursday with Iran’s parliament speaker as part of international efforts to press for an extension of the ceasefire.

The fighting has killed at least 3,000 people in Iran, more than 2,290 in Lebanon, 23 in Israel and more than a dozen in Gulf Arab states. Thirteen U.S. service members have also been killed.

Israel says it will keep troops in Lebanon

Israeli forces have engaged in fierce battles with Hezbollah in the border area as they pushed into southern Lebanon to create what officials have called a “security zone.”

Israel’s hard-line Defense Minister Israel Katz said said Israel would continue to hold all the places it is currently stationed, including a buffer zone extending 10 kilometers (6 miles) from the border into southern Lebanon. He said many homes in the area would be destroyed and Lebanese residents will not return.

Hezbollah has said Lebanese people have “the right to resist” Israeli occupation of their land and that their actions “will be determined based on how developments unfold.”

Israel and Hezbollah have fought several wars and have been fighting on and off since the day after the start of the Gaza war. Israel and Lebanon reached a deal to end that war in November 2024, but Israel has kept up near-daily strikes in what it says is an effort to prevent the Iran-backed militant group from regrouping. That escalated into another invasion after Hezbollah again began firing missiles at Israel in response to its war on Iran.

Pakistan army chief meets with Iranian parliament speaker

Pakistan’s army chief met Thursday with Iran’s parliament speaker as part of efforts to press for an extension to a ceasefire that has paused almost seven weeks of war between Israel, the U.S. and Iran.

Rregional officials reported progress, telling AP the United States and Iran had an “in-principle agreement” to extend it to allow for more diplomacy. They spoke on condition of anonymity to discuss sensitive negotiations.

Mediators are pushing for a compromise on three main sticking points: Iran’s nuclear program, the Strait of Hormuz and compensation for wartime damages, according to a regional official involved in the mediation efforts.

Trump on Friday suggested Iran has agreed to hand over its enriched uranium.

“The U.S.A. will get all Nuclear ‘Dust,’ created by our great B2 Bombers — No money will exchange hands in any way, shape, or form,” he said in a post. Nuclear dust is the shorthand Trump frequently uses to refer to the highly enriched uranium that is believed buried under nuclear sites the U.S. bombed during last year’s 12-day war between Israel and Iran.

If true, it would be a major concession from Iran, and would lock in a key demand of the U.S. to end the conflict. But neither Iran nor countries acting as intermediaries in the conflict have said Tehran has made such an agreement.

Trump also asserted Thursday that Iran had “agreed to give us back the nuclear dust.”

___

Associated Press writers Matthew Lee and Ben Finley in Washington, Samy Magdy in Cairo, Munir Ahmed in Islamabad, Abby Sewell in Beirut and Melanie Lidman in Tel Aviv, Israel, contributed to this report.

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The leaders of France and the U.K. on Friday welcomed the announcement by Iran and the U.S. that the Strait of Hormuz is open, but said freedom of navigation must be permanently restored to the key oil route choked by the U.S.-Israeli war on Iran.

President Emmanuel Macron and Prime Minister Keir Starmer said they would keep planning an international mission to restore maritime security, which Starmer said will be deployed “as soon as conditions allow.” They said military planners will meet in London next week.

Speaking after a gathering of some 50 countries and international organizations, Macron said “we all demand the full, immediate and unconditional reopening of the Strait of Hormuz by all parties.”

As the meeting was underway, U.S. President Donald Trump and Iran’s foreign minister declared the strait open to commercial vessels. Oil prices plunged after Iranian Foreign Minister Abbas Araghchi posted on X that passage for commercial vessels would remain “completely open” for the duration of a 10-day ceasefire in Lebanon.

Trump in an all-caps social media post said that the U.S. Navy’s blockade of Iranian ships and ports would remain in force “UNTIL SUCH TIME AS OUR TRANSACTION WITH IRAN IS 100% COMPLETE.”

Starmer cautiously welcomed the announcement, but said it must become “both lasting and a workable proposal.”

The Paris meeting is part of attempts by sidelined nations to ease the impact of a conflict they didn’t start and haven’t joined, but that has sent the global economy reeling. Petroleum prices soared after the war started on Feb. 28, when Iran effectively shut the narrow strait through which a fifth of the world’s oil usually passes.

The U.S. is not part of the planning for what has been branded the Strait of Hormuz Maritime Freedom of Navigation Initiative, which Macron said would be “a neutral mission, entirely separate from the belligerents to escort and secure the merchant ships transiting the Gulf.”

Starmer, facing political troubles at home, was greeted by Macron in the courtyard of the Elysee presidential palace on Friday afternoon. German Chancellor Friedrich Merz and Italian Premier Giorgia Meloni also attended in person. Others, including the prime ministers of Australia and Canada, the South Korean and Ukrainian presidents and representatives of China and India, joined by video.

Military planning underway

In an echo of the “coalition of the willing” assembled to provide security for Ukraine in the event of a ceasefire in that war, Starmer said that along with France, the U.K. will lead a multinational mission to protect freedom of navigation as soon as conditions allow.

“This will be strictly peaceful and defensive, as a mission to reassure commercial shipping and support mine clearance,” he said.

He said more than a dozen countries had agreed to contribute assets, far fewer than in the wider Hormuz coalition.

Britain has discussed using mine-hunting drones, deployed from the ship RFA Lyme Bay.

The war has highlighted the shrunken state of the Royal Navy, which has deployed just one major warship, the destroyer HMS Dragon, to the eastern Mediterranean. France, which has the EU’s most powerful military, has sent its nuclear-powered aircraft carrier to the region, alongside a helicopter carrier and several frigates.

Meloni said she had expressed Italy’s “willingness to make its naval units available,” while Merz said Germany could contribute mine clearance and maritime intelligence capabilities to such a mission, but would need parliamentary support and a ″secure legal basis″ such as a U.N. Security Council resolution.

He said Germany, ″if possible, would also like to see the United States of America participate; we believe this would be desirable.″

That’s a departure from Macron, who has said the mission will involve countries not involved in the conflict.

Macron’s office said roles for members of the coalition could include “intelligence, mine-clearing capabilities, military escorts (and) communication procedures with coastal states.”

Sidharth Kaushal, a research fellow in sea power at the Royal United Services Institute think tank, said mine-clearing and creating a warning system for maritime threats were more likely roles for the coalition than warships escorting commercial tankers through the strait.

“You need huge numbers of vessels for that sort of thing, which nobody has,” he said.

Trump dismisses NATO as ‘paper tiger’

Iran expert Ellie Geranmayeh, deputy head of the Middle East and North Africa program at the European Council on Foreign Relations think tank, said mine-clearing is an area where European countries and their partners could play a role.

“They would be a better party to do this than the United States, because once you have U.S. military doing this and lingering on Iranian shores, it creates a potential arena for Iran and the U.S. to have miscalculations and get back into a sort of military tension,” she said.

The operation is partly a response to Trump, who has berated allies for failing to join the war. The president has called allies “cowards,” said NATO “wasn’t there when we needed them” and telling Britain: “You don’t even have a navy.”

Kaushal said European countries were likely trying “to demonstrate the ability to provide security in a way that’s distinct from, if not completely separate from, the U.S. and which also demonstrates a capacity for independent action.”

“How many states actually have spare capacity to offer to this is a pretty open question.”

Trump appeared dismissive of European offers of help, though he referred to NATO rather than the Franco-British-led coalition.

“Now that the Hormuz Strait situation is over, I received a call from NATO asking if we would need some help. I TOLD THEM TO STAY AWAY, UNLESS THEY JUST WANT TO LOAD UP THEIR SHIPS WITH OIL,” he posted on social media.

“They were useless when needed, a Paper Tiger!”

___

Lawless reported from London. Associated Press writer John Leicester in Paris contributed to this report.

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Rama Duwaji, the wife of New York City Mayor Zohran Mamdani, has apologized for “harmful” social media posts she made as a teenager, responding publicly after a conservative news outlet combed through her online profiles and resurfaced material, including a post in which she used an anti-gay slur.

In an interview with the arts website Hyperallergic, Duwaji, an illustrator, said she felt “a lot of shame being confronted with language I used that is so harmful to others,” adding “being 15 doesn’t excuse it.”

“I’ve read and seen a lot of what others have had to say in response, and I understand the hurt I caused and am truly sorry,” she said in the interview, published Wednesday, in response to a question about adjusting to life as a public figure.

Duwaji did not specify which comments she was referring to, nor did she address other, more recent social media activity regarding Israel that has attracted heavy scrutiny as Mamdani tries to ease concerns among some in the city’s Jewish community over his own criticism of Israel’s treatment of Palestinians.

Last month, The Washington Free Beacon reported on years of Duwaji’s online activity across a handful of social media platforms, finding she had shared posts praising female Palestinian militants who participated in plane hijackings and bombings in the 1960s and early 1970s. In 2015, she shared a post in which someone else wrote that Tel Aviv was occupying Palestinian land and “shouldn’t exist.”

Duwaji also once used a racial slur for Black people while affectionately addressing a friend and used an abbreviated slur for gay people in 2013.

The mayor has previously said his wife is a “private person” who does not hold a formal position in City Hall. Asked Thursday about which specific posts his wife regretted, Mamdani demurred.

“She shared some of her reflections in this interview. I won’t add much to them, what I will say, however, is that she is someone of incredible integrity,” Mamdani told reporters.

He added that questions about Duwaji’s social media activity were “part and parcel” of his own choice to run for mayor, “a decision that has ramifications for those that I love.”

Separately, Duwaji has also come under criticism for liking an Instagram post that appeared to cheer Hamas’ Oct. 7, 2023 surprise attack on Israel. The Free Beacon has also reported that Duwaji provided an illustration for an essay by an author who described the Oct. 7 attack as “spectacular” and had called Jewish Israelis “rootless soulless ghouls.”

Mamdani has previously said his wife had been commissioned to illustrate an excerpt of a book by a third party, and said she had never engaged or met with the author, and that Duwaji had not seen the author’s previous comments. He called the author’s rhetoric “patently unacceptable” and “reprehensible.”

___

AP writer Jake Offenhartz contributed

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A man carrying a backpack with an AR-style pistol inside was arrested Thursday after walking into health insurer Aetna’s headquarters in Connecticut, police said.

Security guards detained the man without incident shortly after 10 a.m., within 3 minutes after he entered the Hartford building. They held him until city police officers arrived, a spokesperson for Hartford police said.

It wasn’t immediately clear what the man’s plans were, Lt. Aaron Boisvert said.

The man was brought to Hartford police headquarters and charged with illegal possession of an assault weapon, criminal possession of a firearm, possession of a large-capacity ammunition magazine and trespassing. Court and public records show he has a criminal history that includes convictions for assault, threatening and drug possession.

It was not immediately clear if the man has a lawyer who could respond to the allegations.

Woonsocket, Rhode Island-based CVS Health, Aetna’s parent company, released a brief statement on the incident and did not immediately respond to follow-up questions.

“Earlier today, a suspicious person attempted to enter our office, was apprehended immediately by our security team and taken into custody by local police,” the statement said.

The arrest comes amid concerns about health care executives’ safety, following the December 2024 killing of UnitedHealthcare CEO Brian Thompson in New York City. Luigi Mangione, an Ivy League graduate from a wealthy Maryland family, has pleaded not guilty to state and federal charges connected to the killing. He has become a cause célèbre for people upset with the health insurance industry.

In February, CVS Health announced it would be laying off more than 300 remote workers who reported to the Aetna headquarters.

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While some tech leaders shy away from admitting their job cuts are related to AI, Block’s CEO Jack Dorsey pointed to the advanced tech in cutting 40% of his staffers. Dorsey, who also founded Bluesky and Twitter (acquired by Elon Musk and renamed to X), is pulling back the curtain on a major layoff decision that hit a tipping point last December

At the end of 2025, Dorsey and fellow Block leaders headed home for the holidays and tinkered with AI tools. And straight away, they recognized models like Anthropic’s Opus 4.6 and OpenAI’s Codex 5.3 were more powerful than before; reconvening with his team after the break, they agreed the company would not look the same, or be the same size, moving forward in the era of AI.

“We just did this exercise of, ‘Okay so what is the minimal number of people that we would need to keep the service up 100%?’” Dorsey said recently on Sequoia Capital’s Long Strange Trip podcast.

“Next, ‘What is the minimal number of people that we would need to be to fully be in compliance with our regulators?’” he continued. “Then third, ‘What is the minimal set of folks that we need in order to grow to fulfill our commitments we’ve made to the street, but also rebuild the company as an intelligence?’”

When they questioned how many humans would need to stay on board if the company was built today with the latest AI tools, Dorsey said, he and fellow leaders at the $41 billion fintech company landed on a headcount reduction of 40% as the magic number going forward. More than 4,000 of Block’s 10,000 employees would be affected. 

Cutting two in five employees is a big transition for any business—so Dorsey said they even left some headcount buffer in case they made “mistakes” in their calculations. “Which we did,” Dorsey admitted.  

But ultimately, the chief executive believes operating will be much easier, and he is more confident progressing as a business enabled by AI. 

Dorsey believes cutting staffers sooner rather than later has more ‘integrity’

Ultimately, Dorsey said the choice went from “expiration to execution” within a matter of three weeks. And if Block had chosen to stick its head in the sand about AI job displacement, it might be worse off, the CEO reasoned. 

In a note from Dorsey and Roelof Botha, Sequoia partner and Block board member, the pair referenced AI as a huge organizational shift from the conventional management hierarchy pioneered by the Roman Army.

He also believes that it’s more responsible to cut staffers loose now rather than prolong the inevitable; and it’s a shared vision of AI-driven job placement that has left many workers hand-wringing over the fate of their jobs. 

“I wanted to make sure that if we knew that this was what our company was going to be in the future, I didn’t want to have to do it with our backs against a wall,” Dorsey explained on the podcast.

“I want to be ahead of it, because then we can do it with a lot more integrity,” he continued. “We can do it with a lot more generosity for the people that we’re asking to leave, and even for the people that we’re asking to stay.”

Dorsey wrote out a detailed note to the board breaking down the decision, who were ultimately receptive to move forward with the plan. When Block’s layoff hit the airwaves, it joined a slew of other businesses linking AI to their job cuts, raising conversation about how quickly automation could reshape the workforce. However, Dorsey said the business is only responding to a new era of AI-enabled success. 

“We’re not just reacting into [sic] something mediocre,” Dorsey said. “We’re acting towards excellence.”

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OpenAI and Anthropic are backing opposing AI bills in the Illinois General Assembly that try to answer what should happen when AI makes something go terribly wrong. 

It’s the latest round in the companies’ ongoing feud over AI safety and regulation, as their CEOs have traded internal and public barbs over each other’s approach. 

OpenAI is backing SB 3444, under which frontier AI developers would not be liable for causing death or serious injury to 100 or more people or causing more than $1 billion in property damage. This protection includes cases when AI causes or materially enables the creation or use of chemical, biological, radiological, or nuclear weapons.

This week, Anthropic said it opposes the bill, WIRED first reported.    

“We are opposed to this bill. Good transparency legislation needs to ensure public safety and accountability for the companies developing this powerful technology, not provide a get-out-of-jail-free card against all liability,” Cesar Fernandez, head of U.S. state and local government relations at Anthropic, said in a statement to Fortune. 

Anthropic is instead supporting a separate bill, SB 3261, which would require AI developers to publish a public safety and child protection plan on their website. The bill also creates an incident reporting system to inform legislators and the public of “catastrophic risk,” or an incident that could result in the death or serious injury of 50 or more people caused by a frontier developer’s development, storage, use, or deployment of a frontier model. 

The bill also covers children’s safety, an aspect missing from the OpenAI-backed bill. Under SB 3261, AI developers would be held liable if their model causes a child severe emotional distress, death, or bodily injury, including self-harm. 

A ‘very low’ bar

Experts told Fortune that SB 3444 is unlikely to pass as it’s a markedly weak approach to corporate liability in the case of catastrophe while Illinois has been a leader on AI regulation. Last year, the state banned AI therapy while allowing its use in administrative and support services for licensed professionals. 

SB 3444 requires companies to have a public AI safety plan, but there is no measure for enforcement. If developers did not “intentionally or recklessly” cause the incident, they would be protected from liability. 

Intentional or reckless is not a common legal standard of care for companies engaging in highly dangerous activities, said Anat Lior, an assistant professor of law at Drexel University, who is an expert on AI liability and governance.

“Typically, the state of mind, or the fault associated with the harm, does not matter,” she explained. “They are setting the bar very low here. Being able to prove that you did something intentionally that involves AI is going to be very hard.” 

Touro University law professor Gabriel Weil, who has collaborated with lawmakers in New York and Rhode Island on bills that would put greater liability on AI developers, said the OpenAI-backed bill’s approach is “pretty indefensible.” 

“That seems like a very weak requirement, and in exchange you get near total protection from liability, from these extreme events,” Weil told Fortune. “I think that’s the opposite direction that we should be moving in.”

An OpenAI spokesperson told WIRED that the company supports SB 3444’s approach because it reduces “the risk of serious harm from the most advanced AI systems while still allowing this technology to get into the hands of the people and businesses.” 

An OpenAI spokesperson told Fortune that the company strongly supports efforts that improve the transparency and risk reduction in AI safety protocols, citing its collaboration with lawmakers in California and New York to pass safety frameworks and non-compliance penalties. The company will continue to work with states in the absence of federal legislation. 

“We hope these state laws will inform a national framework that will help ensure the U.S. continues to lead,” the spokesperson wrote. 

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Yoshua Bengio, a computer scientist considered one of the “godfathers of AI” for his help in pioneering the deep learning systems that underpin today’s AI models, has been warning about the risks of the technology he helped to create for years. Now, he says new models like Anthropic’s Mythos demonstrate why international institutions urgently need to work together to address AI’s potential dangers.

Anthropic’s newest model, Claude Mythos, is said to represent a major step forward in cybersecurity, identifying thousands of previously unknown “zero-day” vulnerabilities. Zero-days are bugs in software that are unknown to the programmers who have created that software which could enable hackers to bypass security controls and potentially steal vital data.

However, the company has said that because these capabilities are dual-use—and could enable sophisticated cyberattacks capable of disrupting critical global infrastructure—it is only releasing the system to a small group of firms to give them a head start in securing vital systems.

That initial group of companies Anthropic chose to share Mythos with were all American-based technology firms whose software underpins a lot of the world’s critical systems. The company has also briefed the U.S. government on the technology and is in the process of beginning to provide some U.S. government departments and agencies with access to the model.

While some have praised the company’s caution in opting for a highly-circumscribed release of Mythos, the decision has raised uncomfortable questions about the concentration of power in the hands of just a single U.S. company. Anthropic alone decided with whom it would share Mythos. That has left many businesses and governments excluded from that initial cohort begging for access so they too can safeguard their systems. The situation has hammered home to many why responsibility for AI governance needs to be shared much more broadly and internationally.

“It doesn’t make sense that private individuals are deciding the fate of infrastructure for everyone else,” Bengio said in an interview with Fortune. “What about all the companies and all the countries that didn’t get access?”

Bengio, who has won the Turing Award, considered computer science’s equivalent of the Nobel Prize, is hardly the only one urgently asking that question. The Bank of England, for example, pressed Anthropic for access to Mythos for U.K. banks, publicly announcing that the company had assured it these institutions would begin to get access to the model this coming week. Discussions at the IMF and World Bank spring meetings, currently taking place in Washington, were unexpectedly dominated by concerns over Mythos’ capabilities. Policymakers warned that systems like Mythos could expose weaknesses across the global banking system, while regulators and executives—particularly in Europe—said they had yet to gain access to the model or fully understand the scale of the vulnerabilities it has uncovered.

For many outside the U.S., Mythos is likely to accelerate an already burgeoning desire for “AI sovereignty”—a term which generally refers to having AI capabilities and infrastructure that are not dependent on companies and governments located outside that country. Many places are particularly wary of being overly-dependent on American tech at a time when the U.S. government has become a less reliable ally and has shown a willingness to weaponize supply chain bottlenecks to achieve other policy objectives. There is also concern about being beholden to just a handful of American tech CEOs.

Meanwhile in Washington, the U.S. government is moving to secure its own access to the powerful model. In a memo reviewed by Bloomberg, the White House Office of Management and Budget told Cabinet departments this week that it is setting up protections to allow federal agencies—including Defense, Treasury, Commerce, Homeland Security, Justice, and State—to begin using a version of Mythos, with more details expected “in the coming weeks.” 

The push comes despite an ongoing legal fight between Anthropic and the Pentagon, which earlier this year declared the company a supply chain threat over a dispute about AI safeguards. (Anthropic has been challenging that designation in court.) According to a report from Axios, Anthropic CEO Dario Amodei is scheduled to meet White House chief of staff Susie Wiles on Friday in an effort to resolve the on-going dispute. 

Bengio is urging far greater international coordination in response to the fresh cybersecurity risks, including the creation of a regulatory body similar to the Food and Drug Administration to oversee the development and deployment of advanced AI systems. He argued that governments—particularly the U.S.—should place clearer obligations on companies developing these models to ensure their technologies do not inadvertently harm critical infrastructure in other countries, and that oversight of such high-stakes decisions cannot be left to private actors alone.

“There needs to be an agency really in charge of overseeing these kinds of decisions,” he said. “As the power of AI continues to grow, this question of international commitment becomes pressing. There’s no reason that it’s going to limit itself to attacking U.S. infrastructure or U.S. citizens. So this has to be an international affair.”

The open-source question

Bengio also said an agreement with China needed to be part of any meaningful global response. The U.S. and China are locked in an aggressive race for AI supremacy. 

While Bengio estimated that leading Chinese AI models are likely lagging their U.S. counterparts in raw capabilities by roughly six months, he stressed that the gap does little to reduce the underlying risk. 

China is also making rapid progress in open-source models—systems where the underlying model parameters and code are made publicly available—which Bengio warned could ultimately pose an even greater danger than powerful systems like Mythos.

Unlike proprietary models, these open-source systems can be downloaded, modified, and run by anyone. Bengio said that means the safety guardrails companies build in—such as filters designed to block malicious requests—can simply be stripped away by users, leaving little to prevent misuse. 

As models become more capable at identifying and exploiting software vulnerabilities, he warned that releasing them openly could hand powerful cyber capabilities directly to bad actors.

The concern isn’t limited to open-source AI. Bengio warned that the broader tradition of open-source software—long considered a pillar of internet security—is also being reshaped by these capabilities.

For decades, open-source software—where code is publicly available—has been seen as more secure, because it allows more developers to inspect and fix vulnerabilities. But highly capable AI systems can now scan that same public code at scale to identify weaknesses far faster than humans, potentially turning widely used open infrastructure into a prime target. While Bengio, a long-time advocate of open-source, said open systems still offer important transparency and democratic benefits, in an era of AI-assisted cyber offense, they can also become a serious liability.

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The India–Middle East–Europe Corridor, known as IMEC, is no longer just a concept on paper. It is being tested in real time.

As policymakers place increasing pressure on securing critical routes such as the Strait of Hormuz, IMEC is emerging as a resilience framework. It sits at the intersection of infrastructure, geopolitics, and global markets.

Often described as an economic corridor, IMEC is better understood as a multimodal system. It links ports, rail, energy, and digital infrastructure across India, the Gulf, and Europe. It moves goods, data, and energy across regions that do not always align politically. It connects India to Europe through the Gulf and onward to the Eastern Mediterranean.

This did not emerge in isolation.

Within the U.S. government, there was a sense that something new was emerging. The Abraham Accords demonstrated that long-frozen regional relationships could shift, opening channels for cooperation. I2U2 built on that momentum by aligning partners across key sectors. IMEC was conceived within this trajectory, extending that cooperation into physical and digital infrastructure linking regions. At the time, there was real optimism that these frameworks could reshape connectivity, investment, and regional integration.

The momentum of IMEC stalled with the war in Gaza shortly after it was announced at the G20 meetings in India in 2023, underscoring the challenges of implementing transnational projects amid conflict and uncertainty.

By mid-2025, regional discussions resumed with a focus on feasibility. Now, escalating tensions over Iran are stress-testing whether such a system can function under pressure.

In his recent book, West Asia, Mohammed Soliman, senior fellow at the Middle East Institute  argues that what has long been described as the “Middle East” is better understood  as “West Asia,” a renaming that reflects a broader system shaped by trade, energy, and technology flows. He reframes the region not as a collection of conflicts, but as a connected system. 

West Asia sits at the western edge of the world’s largest landmass. It is connected to cities like Mumbai and Jakarta through networks that predate the nation-state and continue to shape the region’s role in the global economy.  At its core, IMEC is about whether trust can be built across borders through infrastructure. It is being built through public-private partnerships. It requires coordination across governments, investors, and operators. 

Recent tensions have slowed progress but increased the sense of urgency. 

Coordination across physical and digital public infrastructure (DPI) is now under pressure as national priorities take precedence.

 In India’s case, this is not reactive. Self-reliance and global integration have been advancing in parallel. 

This is not theoretical. India anchored IMEC through a multilateral agreement. It is now advancing through bilateral frameworks, most notably with the UAE, alongside coordination with the United States and Saudi Arabia across infrastructure, energy, and logistics.

India has also been in active discussions with IMEC signatories such as the United States, Saudi Arabia and Italy, and non-signatories such as Israel, Jordan and Egypt. Disruptions to trade routes, energy flows, and investment are already shaping how this corridor is being evaluated.

India is diversifying and derisking its supply chains. It is expanding manufacturing capacity and attracting global investment through public-private partnerships and Make in India. These efforts are positioning the country as a key node in global supply chains. Afaq Hussain, a nonresident fellow at the Atlantic Council, has emphasized the importance of manufacturing competitiveness and supply chain integration, a point he underscored in a recent Atlantic Council discussion.

India is building relationships across regions that do not always align politically. It engages across geopolitical divides, maintaining ties with partners such as the United States while continuing to work with countries like Iran and China. This reflects a flexible approach to diplomacy and economic engagement.

India is also shifting its energy strategy. Agreements with partners such as Saudi Arabia include collaboration on green hydrogen. At the same time, it maintains ties with Russia and continues purchasing Russian oil despite U.S. pressure, underscoring its approach to energy security.

For the United States, this moment matters.

The U.S.–India relationship is becoming more important as post-World War II structures no longer fully serve a world reorganizing around regions and interdependence. India’s expanded economic role, combined with Washington’s strategic decoupling from China, is reshaping how the two countries engage.

India operates across differences. It maintains long-standing diplomatic relationships across the Global South while engaging with partners that do not always align with U.S. interests. Recent engagements with both Israel and Iran underscore how India navigates complex geopolitical lines.

Trust is no longer assumed. It must be built across systems that were not designed to work together. Digital public infrastructure (DPI), developed and tested at scale in India, offers a model for cross-border systems such as IMEC. It enables flows of data, services, and capital across borders.

But questions around data governance remain. Even between the United States and Europe, data-sharing frameworks have faced repeated challenges. Extending trust across the U.S.–India corridor will require alignment on standards and safeguards. DPI may provide the rails, but trust will depend on how those systems are governed.

IMEC must operate across political systems, security conditions, and regulatory frameworks, without a central authority coordinating all actors. 

In recent meetings with business and policy leaders in India, including engagements through our Columbia SIPA capstone in collaboration with the Vishwamitra Research Foundation (VRF), one point stood out to our students: the technical components can be built. Aligning political interests is the harder challenge. This is where sustained policy coordination becomes critical. Relationships — and trust — matter.

Critical chokepoints such as the Strait of Hormuz highlight the realities these systems must navigate. Disruptions in and around these routes explain why IMEC is being tested now. Countries and companies are looking for pathways that can function under pressure.

IMEC will not be defined by infrastructure alone. It will depend on how it is governed across jurisdictions, how risk is managed in real time, and whether it can function under pressure.

What has been less discussed is how companies are responding. Global multinationals are increasingly playing a leadership role. They operate across markets that are economically connected but not always politically aligned. Their decisions shape supply chains, workforce integration, and local engagement.

This is where the concept of the license to operate becomes real.

Trust sits at the center of all of this. It underpins public-private partnerships, shapes alignment between countries, and determines whether companies can operate credibly in local markets.

Without it, infrastructure does not translate into cooperation.As the United States approaches its 250th year, maintaining that trust will require sustained engagement and consistency across partners. Trust is shaped by the histories and relationships countries carry with them.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Software stocks have been in freefall. The S&P software index dropped about 20% in February, and a new word has entered the business lexicon: “SaaSpocalypse.” The thesis is that artificial intelligence is poised to undermine the business model that made enterprise software one of the most profitable industries on the planet.

Software-as-a-service has long been an investor’s dream — high margins, recurring revenues, and sticky customers. Companies like Salesforce, SAP, and ServiceNow grew into giants on the back of that model. But the dream is starting to crack. Over the past two weeks, we co-hosted roundtables with senior business leaders in San Francisco and New York to discuss how AI is reshaping value creation. The threat to SaaS was a recurring theme — and their observations point to three structural forces that enterprise software companies can no longer ignore.

The first is market vulnerability. SaaS margins have been high for decades, propped up by switching costs that keep enterprise customers locked in — whether or not they are satisfied. Many companies pay hefty sums for ERP, CRM, and other business-critical platforms not necessarily because they love the product but because migrating away is painful. That kind of captive market is an invitation to disruption.

The second force is collapsing barriers to entry. Building enterprise-grade software used to require enormous capital and engineering talent. Today, AI coding agents have made it much cheaper and faster. That means more competitors, more alternatives, and ultimately more pressure on the margins that SaaS companies have long taken for granted.

The third — and perhaps most consequential — force is the rethinking of workflows. SaaS companies built their empires by standardizing processes across industries: one CRM for every company, one finance platform for every CFO. But AI is enabling organizations to redesign workflows from the ground up. Several roundtable participants argued that deep vertical expertise — an intimate understanding of healthcare operations, for instance — is becoming more valuable than mastery of a horizontal, one-size-fits-all process. This flips the competitive matrix. Instead of selling a standardized workflow across sectors, the winning play may be offering sector-specific intelligence that adapts to how each industry actually works.

Together, these forces — dissatisfied customers, lower barriers to entry, and shifting value propositions — are likely to intensify competitive pressure across the software industry.

Software companies aren’t alone — AI is reshaping competitive dynamics across entire value chains. The clients of SaaS companies are under pressure too, forced to rethink operations as AI capabilities accelerate.

Despite these concerns, our roundtable participants did not predict the death of SaaS. Foundational software layers will still be needed, and enterprises will resist becoming wholly dependent on any single AI vendor. But margins will likely compress. A key driver will be a shift from input-based pricing — charging per user or per seat —  to output-based pricing, where customers pay for results. Several AI-native companies are already pushing this model. If it takes hold, it could erode the economics that made SaaS so lucrative. There is a catch, however: output-based pricing requires the ability to measure outcomes reliably. For some use cases — AI-powered call centers, for example — the transition may come quickly. For complex domains like legal services or healthcare, defining and tracking output quality is far harder.

Another underappreciated implication of AI is that it destabilizes today’s enterprise software ecosystems. As copilots and agents start to configure and run workflows, the old division of labor — vendors sell, systems integrators implement, consultancies advise — begins to blur. ERP and SaaS vendors are moving into AI-enabled services; integrators and consultancies are productizing vertical agent layers that sit on top of platforms; hyperscalers and model providers are bundling tooling that bypasses parts of the application layer. The fight shifts to new control points: orchestration, privileged data access, and distribution into day-to-day work. Those control points, and the ecosystems built around them, will determine who captures value.

Will software valuations recover? It is impossible to say, and will depend on how SaaS firms play their hand. But February felt like an inflection point. For years, AI was sold on potential. Now it is delivering impact. The technology has become central to geopolitics and national strategy. We may be crossing from the era of “pay attention, this will matter someday” to the era of “pay attention, this matters now.”

The SaaSpocalypse may be an overstatement. But the forces behind it are real, and the software industry’s most comfortable assumptions are no longer safe.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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At 8:30 a.m. Eastern Time today, oil was priced at $96.18 per barrel with Brent serving as the benchmark (we’ll explain different benchmarks later in this article). That’s a drop of 88 cents compared with yesterday morning and around $28 higher than the price one year ago.

Will oil prices go up?

It’s impossible to forecast oil prices with detailed precision. Many different elements affect the market, but ultimately it boils down to supply and demand. When worries about economic recession, war, and other large-scale disruptions increase, oil’s path can shift fast.

How oil prices translate to gas pump prices

Gas prices at the pump don’t only track crude oil. They also include what it takes to refine and move that fuel, the taxes layered on top, and the extra markup your local station adds to stay in business.

Since crude oil generally makes up a majority of the per-gallon cost, changes in its price have an outsized impact. When oil surges, gas prices typically rise in tandem. But when oil retreats, gas prices often lag on the way down, a trend sometimes described as “rockets and feathers.”

The role of the U.S. Strategic Petroleum Reserve

In case of emergency, the U.S. has a store of crude oil known as the Strategic Petroleum Reserve. Its primary purpose is energy security in case of disaster (think sanctions, severe storm damage, even war). But it can also go a long way toward softening crippling price hikes during supply shocks.

It’s not a long-term answer and is more meant to provide temporary relief, assisting consumers and keeping critical parts of the economy running, like key industries, emergency services, public transportation, etc.

How oil and natural gas prices are linked

Both oil and natural gas are key sources of the energy we use every day. Because of this, a big change in oil prices can affect natural gas. For example, if oil prices increase, some industries may swap natural gas for some segments of their operations where possible, which increases demand for natural gas.

Historical performance of oil

To gauge oil’s performance, we often turn to two benchmarks:

• Brent crude oil, the main global oil benchmark.
• West Texas Intermediate (WTI), the main benchmark of North America

Between these two, Brent better represents global oil performance because it prices much of the world’s traded crude. And, it’s often the best way to track historical oil performance. In fact, even the U.S. Energy Information Administration now uses Brent as its primary reference in its Annual Energy Outlook.

Looking at the Brent benchmark across several decades, oil has been anything but steady. It’s seen spikes due to factors such as wars and supply cuts, and it’s also seen crashes from global recessions and an oversupply (called a “glut”). For example:

• The early 1970s brought the first big oil shock when the Middle East cut exports and imposed an embargo on the U.S. and others during the Yom Kippur War.
• Prices dropped in the mid-1980s for reasons such as lower demand and more non-OPEC oil producers entering the industry.
• Prices spiked again in 2008 with increased global demand, but it soon plummeted alongside the global financial crisis.
• During the 2020 COVID lockdown, oil demand collapsed like never before—bringing prices below $20 per barrel.

All to say, oil’s historical performance has been anything but smooth. Again, it’s hugely affected by wars, recessions, OPEC whims, evolving energy initiatives and policies, and much more.

Energy coverage from Fortune

Looking to stay up-to-date regarding the latest energy developments? Check out our recent coverage:

• Trump says Iran war will end ‘pretty soon’ as uranium deal is in sight
• Trump’s war in the Middle East may end up a global boon for renewables
• Europe has (maybe) 6 weeks of jet fuel left

Frequently asked questions

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Inflation isn’t in a great place right now: Despite “affordability” becoming the buzzword of D.C., prices are moving in the opposite direction to consumers’ wishes. The latest CPI report from the Bureau of Labor Statistics shows inflation jumped once again, up to 3.3% over the past 12 months.

Much of this has come from increases in commodities like gasoline, which largely can be attributed to the oil supply shock following U.S. and Israeli attacks on Iran.

A tentative optimist might suggest things are looking up, with the White House suggesting an end to the conflict is imminent. But that does little to address the reality for those paying higher prices at the pump, many of whom had hoped Trump’s return to office would see the power of their day-to-day spending improve at best, and plateau at worst.

Yet even inflation of 3.3% belies the strain some households are under. Families paying for childcare, for example, may find their situation feels significantly worse than economic data describes.

“The economy is constantly shifting and no single household, no single consumer, is experiencing things exactly the same way,” Taylor Bowley, an economist at the Bank of America Institute, told Fortune in an exclusive interview. “When people look at GDP for instance, those prints look pretty good, but then when we really dive deep into some of this by income, we’ve also seen childcare has been a topic that has been particularly prevalent for so many households, because from an economist’s term, childcare isn’t necessarily a necessity, but for so many families it totally is. That is not a discretionary item.”

The gap shows up clearly in how the CPI is constructed. The Bureau of Labor Statistics assigns each category a “relative importance” weight based on average household spending.

As of December 2025, the combined category of tuition, school fees, and childcare accounts for just 2.5 of the index. But most of that reflects college tuition (1.35), while daycare and preschool make up just under 0.7.

That puts childcare on par, in CPI terms, with categories like water and sewer services, shopping club memberships, or tools and hardware—an unlikely reflection of how central it is for many families.

This isn’t an error; it’s a feature of the system. The CPI is designed to reflect average spending across all households, including those without children. But for families who do pay for childcare, those costs can take up a far larger share of their budget—meaning price increases will hit them much harder than the headline inflation data suggests.

“We’ve seen that childcare in our data has continued to rise,” Bowley adds. “The cost of childcare obviously impacts labor force decisions, and that in turn impacts labor growth as a whole.”

Consumers are well aware of this fact: In 2024, Pew Research asked nearly 9,000 people why they had chosen to, or did not, have children. The most popular reasoning was that either these people didn’t want to, or it just never happened. But 12% of respondents also said they couldn’t afford to raise a child.

The reality of childcare

Last year, Bowley reported that U.S. childcare costs were rising 1.5 times faster than overall inflation, up 5.2% year-over-year (YoY) in September.

Regional differences are also becoming more noticeable: New England was up 6.6%, for example, and the West North Central division surged 8.2% YoY as of September. Meanwhile, in the South, Nashville led major cities with a more than 6% increase from 2024 averages.

In the October note, Bowley highlighted that the share of households with more than one source of income making childcare payments each month is falling every year, most prominently among lower-income households. It stands to reason that paying for childcare has become so expensive that parents have little choice but for one of them to leave their jobs.

This “very much disproportionately impacts women,” Bowley added, “We’ve looked at how moms have traded in, to some extent, careers for childcare. One reason is that childcare has been, at least within CPI data, and very much so also within our own data, particularly sticky. It is still rising around 1.5 times the rate of overall inflation, which is a real pain point for a lot of families.”

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Good morning. On Fortune’s radar today:

• Trump says Iran war will end “pretty soon” with impending deal.
• Markets: Mixed reaction to possible peace deal.
• Yes, United and American Airlines can be merged. Here’s how.
• Netflix: Reed Hastings bows out — and no, it wasn’t the Warner deal.
• Jamie Dimon sounds private-credit alarm again. Goldman shrugs.
• Low unemployment claims are “hard to believe” given the circumstances.
• New “Misery Index” ranks the worst countries to live in.

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For years, Millennials were the housing market’s most sympathetic losers—priced out, rate-locked, and perpetually waiting for their moment. For a growing slice of that generation, the wait is over. And they’re making up for lost time.

According to the National Association of Realtors’ 2026 Home Buyers and Sellers Generational Trends report, older Millennials—now aged 36 to 45—have quietly become the highest-earning, biggest-spending generation of home buyers in the market. They post the highest median household income of any generational group at $132,700, buy the largest homes at a median 2,100 square feet, and are the most likely to have children living under their roof. In almost every measurable way, they now look less like the struggling young buyers they once were and more like the Baby Boomers they spent years resenting.

“They really have hit middle age,” said NAR Deputy Chief Economist Dr. Jessica Lautz. “They’re at their peak of their career now or heading in that direction. They may have not wanted to follow that trajectory, but they’re there.”

The equity effect

The mechanism driving this transformation is the same one that has long powered Boomer dominance: home equity. Older Millennials who bought in the mid-2010s or even the early pandemic years have watched their home values climb substantially. They’re now using those gains to trade up—shedding starter homes for larger, more expensive properties that define a move-up market.

It’s a playbook Boomers have run for decades. Buy early, accumulate equity, leverage it into something bigger. Older Millennials, long denied entry to that cycle, are finally running it themselves. Only 33% of older Millennial buyers were purchasing for the first time—down from 36% the prior year—meaning the clear majority are already homeowners making their next move.

A generation splitting in two

The rise of older Millennials throws into sharp relief just how dramatically the broader Millennial cohort has fractured. As a whole, Millennials’ share of home buyers dropped from 29% to 26%—the only major generational group to lose ground. But that headline figure masks a growing divide between two cohorts with almost nothing in common economically.

“I think it’s a definite split right now,” Lautz said. “It’s why we separate the data out from younger and older millennials—it’s not something that we actually always had done, but we started doing it because there had been such a difference.”

Younger Millennials, ages 27 to 35, are still fighting the battle their older counterparts largely won. Their share of first-time buyers plummeted from 71% to 60% in a single year. Student loan debt and credit card burdens weigh more heavily on this cohort, Lautz noted, while older Millennials’ financial pressures have shifted to childcare costs and high rent—the friction of a life already in motion, not one still trying to launch. “Younger millennials,” she said, “are really struggling to enter into the housing market. And that’s feeling out of reach for many of them.”

The record-low first-time buyer share—21% of all purchases, the lowest since NAR began tracking in 1981—is largely their story, although Lautz said that figure has been the case since late 2025. When asked if she thinks this is becoming a structural issue, Lautz agreed: “I think we’re at that point right now.” The consequences are long-term: a first-time buyer locked out until 40 isn’t just delayed—they’re losing years of wealth accumulation. “It becomes a renter versus an owner economic scenario,” she said. “And that’s really what we’re seeing right now.”

Why boomers aren’t going anywhere

Baby Boomers—now aged 62 to 79—accounted for 42% of all buyers and a dominant 55% of all sellers. They move with equity-fueled flexibility, and critically, they have both the means and the motivation. “Homeownership is the number one way that people build wealth in America,” Lautz said, “and they are able to really purchase what they want at a time in their life where they can do what they would like to do.”

What they would like to do, it turns out, is not necessarily downsize—despite saying otherwise. “The stat I think is the funniest,” Lautz said, “is that they tell us one of the reasons they move is to downsize, and then they don’t downsize.” The data backs her up: among Boomers in their 60s, there is almost no change in square footage when they move. Among those in their 70s, the reduction is just 200 square feet—perhaps one bedroom. The pull of family keeps them large: one major motivation for Boomer moves is being closer to friends and family, which in practice means hosting grandchildren over the holidays, not trading a four-bedroom for a condo.

“You have the haves with the baby boomers,” Lautz said, “and to a certain extent Gen Xers and some older millennials, too. And then you have the have-nots who are really trying to get in.”

40 is the new prime

There’s a deeper current running beneath these generational shifts, one that the data keeps surfacing: the traditional American homeownership timeline has fundamentally changed. The median age of a first-time buyer is now 40—a number that would have been almost unthinkable a generation ago. How long first-time buyers expect to own their first home before moving has stretched from as few as five years historically to 15 years today.

A first-time buyer at 40 is also, research suggests, a buyer at or near their actual life peak. Cognitive performance, emotional stability, and earnings all tend to crest in the fifth decade. In a longer American life—one that now routinely extends into the early 80s—the 40s are barely the midpoint. Older Millennials buying their biggest homes and hitting peak income now aren’t running behind schedule. They’re running on a schedule that the 21st century created.

Even Gen Z, whose 4% buyer share edged up from 3%, is entering homeownership unconventionally—35% as single females and 17% as unmarried couples, both generational highs. The traditional family-formation triggers for buying have given way to a simpler one: the desire to own something, on whatever terms are available.

Perhaps no generation captures the full pressure of this market more than Gen X, who Lautz stressed that she didn’t want to leave out, as they are truly embodying the “sandwich generation” handle right now. Gen X, she noted, has quietly become the new face of multigenerational buying—a distinction that once belonged to Boomers. “They could be taking care of an elderly parent, a young adult who can’t afford to live independently is in their house too—and just overall cost savings,” she said. “You can see just the pressures on Gen Xers.”

It’s a fitting image for where the housing market stands in 2026: a generation in the middle, literally and figuratively, holding up the people above them and the people below, in a market that was built for those who got in early and never really had to leave.

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• In today’s CEO Daily: Diane Brady looks for trends in U.S. bank earnings
• The big leadership story: Experts call for a ban on generative AI programs targeting students
• The markets: Large down across Asia
• Plus: All the news and watercooler chat from Fortune.

Good morning. Jamie Dimon of JPMorgan Chase says the economy is resilient but vulnerable to risks. Citigroup CEO Jane Fraser says her company is resilient and off to an “exceptionally strong start.” Over at Bank of America, Brian Moynihan says the U.S. consumer is resilient, despite soaring gas prices. And Wells Fargo chief Charlie Scharf is here to remind us that life is complicated.

Welcome to earnings season! Banks are typically first to report (thank you, regulators!), offering some insights into the economy and a taste of what’s to come. Fraser had a new story to tell, with strong revenue and a restructuring plan dubbed “Project Bora Bora” that she says is 90% complete. Dimon delivered a familiar tale that somehow manages to instill calm and panic at the same time. We know consumers are resilient and oil prices hurt. Dimon already warned stagflation could be “the skunk at the party” in his shareholder letter. Two other themes to watch from 10-Qs and earnings calls of the Big Four banks.

Last Days of Disco. Investors are trading like frenzied night-clubbers wondering if the party’s about to end. Oil prices are up. They’re down. Peace talks are on! No, they’re not. Who’s betting what in the prediction markets? What’s the Fed going to do? Wait: the new Fed chairman is invested in Polymarket? Sell! Buy! Fear. Greed. That volatility produced a lot of profits and trading revenue for the banks, not to mention record bonuses for the traders. But volatility can reflect both uncertainty and mounting risk.

Don’t panic over private credit. Yes, there’s a $265 billion meltdown. Yes, the Fed wants more details on banks’ exposure to the largely unregulated $1.8 trillion market in non-bank lending. The Big Four did collectively report more than $128 billion in exposure to private credit loans this quarter. But Bank of America reported having “structural insulation” from loss in a market they characterize as “largely a repricing of liquidity.”  Dimon, the man who warned us that “when you see one cockroach, there are probably more” a few months ago, is now “not particularly worried.” Citi, which has arguably just recovered from the 2008 financial crisis, is “constantly stress testing” and  comfortable” with its portfolio. Wells Fargo isn’t worried, either, and Treasury Secretary Scott Bessent doesn’t see a systemic problem. So relax, and go worry about that $39 trillion national debt instead.

Contact CEO Daily via Diane Brady at diane.brady@fortune.com

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• Pope Leo XIV sounded the alarm over the growing wealth inequality between CEOs and workers—and he singled out Elon Musk’s path to trillionaire status. In one of first formal interviews after being named pontiff last year, Pope Leo said soaring executive paychecks may be putting the world in “big trouble.” This came as a report warned many billionaire signers of Warren Buffett and Bill and Melinda French Gates’ The Giving Pledge are behind in their philanthropy promises.

If Pope Leo XIV had a seat on Tesla’s board, Elon Musk’s $1 trillion pay package would have been dead on arrival.

The 70-year-old pontiff slammed the widening income gap between the working class and the wealthy—specifically calling out the Tesla CEO as an egregious example of executive excess.

“CEOs that 60 years ago might have been making four to six times more than what the workers are receiving, the last figure I saw, it’s 600 times more than what average workers are receiving,” he told Catholic news site Crux in a September 2025 interview. “The news that Elon Musk is going to be the first trillionaire in the world: What does that mean and what’s that about?”

If that is the only thing that has value anymore, then we’re in big trouble,” he continued.

The Pope’s critique came in September 2025 as Tesla’s board approved a $1 trillion pay package for Musk—contingent on his ability to grow the electric vehicle company by eightfold over the next decade.

While Pope Leo is entitled to an over $400,000 yearly salary, on par with U.S. presidents and university chancellors, his concerns reflect broader anxiety about executive compensation. Among the 100 S&P 500 corporations with the lowest median worker pay, the average CEO compensation hit $17.2 million in 2024 as compared to an average median worker pay of $35,570, according to the Institute for Policy Studies. That’s a ratio of 632 to 1.

Billionaires’ wealth is booming—but their philanthropic giving isn’t

While everyday workers continue to struggle with inflation, wage stagnation, and a tightening job market, the wealth of the ultrarich soars. Billionaire wealth increased three times faster in 2024 than it did in 2023, according to Oxfam. And over the last decade, the top 1% increased their wealth by nearly $34 trillion—enough to eliminate annual poverty 22 times over at the highest poverty line.

Last year, Larry Ellison broke the record for the biggest one-day increase ever recorded in the history of Bloomberg’s Billionaire Index—with his net worth soaring $89 billion thanks to his tech firm Oracle’s rapid growth. At time of publication, Ellison’s net worth sits at $230 billion.

At the same time, many billionaires are behind on their pledges to give away their money through The Giving Pledge—the commitment launched in 2010 by Warren Buffett as well as Bill Gates and Melinda French Gates to give away at least 50% of their wealth to philanthropy during their lifetimes or in their wills.

Among the 256 signers, just nine have followed through with the pact; and even among those who donate, it’s largely given to intermediaries, according to the Institute for Policy Studies. Of an estimated $206 billion donated by the original 2010 Pledgers, roughly 80%, or $164 billion, has gone into private foundations.

And while The Giving Pledge told Fortune the IPS report “paints a misleading picture of the impact and intent of Giving Pledge signatories and the spirit and intent of the Giving Pledge,” the organization admitted there remain important questions that aim to “encourage greater giving.”

A version of this story originally published on Fortune.com on September 15, 2025.

More on wealth

• Warren Buffett says ‘accumulating great amounts of money’ doesn’t achieve greatness—He still lives in a $31,500 Nebraska home and clipped coupons.
• The world’s wealthiest families adopt these 7 key habits for success, according to JPMorgan.
• Steve Jobs didn’t actually become a billionaire thanks to leading Apple—but rather from his work with a film company he bought off George Lucas.

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In the past few days, headlines are buzzing over the possibility of a mega-mega-merger that before the news broke, would have seemed inconceivable: A possible tie-up between United Airlines and American Airlines. American already ranks as the world’s largest carrier by passengers flown, and United stands forth; at their current sizes, the combo would be twice the size of both 2nd place Delta and number three Ryanair on the global stage, and ferry over three-and-a-half times as many folks as continental Europe’s largest stalwart, Lufthansa. In the U.S., the deal would break a near three-way tie with Delta for available seats, and catapult a new behemoth into by far the most dominant stateside position in the annals of air travel.

Any time one airline seeks to buy rival, the proposed transaction attracts anti-trust scrutiny and political controversy practically unmatched in any other realm of M&A. And due to its scale in an already highly-concentrated sector, and potential to raise fares, limit choice, and curb the frequency of service to dozens of smaller markets, this mother of all unions would face far fiercer than usual opposition on multiple fronts. Hence, it’s a long shot. But the industry insiders Fortune interviewed swear that it’s by no means impossible. The reason: The Trump Administration’s attraction to grand gestures—you can call it broad exercises in industrial policy—that remake wide swaths of the economy over (and may sideline the usual top goals such as ensuring strong competition).

Here are five burning questions this potential mega-merger raises.

How did United’s unusual quest come about?

The week of April 13, Reuters revealed, apparently for the first time, a White House meeting held on February 25th to discuss the over half-a-billion dollar re-development project planned for Dulles International Airport near Washington, D.C. Reuters reported that President Trump hosted United Airlines CEO Scott Kirby at the confab. United’s the dominant carrier at Dulles, claiming an 82% market share. Fortune has further learned from people familiar with the talks that Susie Wiles, the President’s chief of staff, was instrumental in organizing the discussion. According to these sources, Wiles is strongly committed to the sweeping Dulles revamp that includes a new United concourse and would like to see Trump receive recognition for the new Dulles. “The president won’t rename Ronald Reagan Washington National for himself!” quips an industry insider. Texas governor Greg Abbott also attended, say people Fortune spoke to. Both airlines are crucial to the Lone Star State’s economy: American is headquartered in Ft. Worth, and United dominates George W. Bush Intercontinental in Houston.

According to the Reuters piece and other accounts, Kirby floated the joining of forces concept directly to the President. Kirby contended that the combination would achieve the giant scale required to better battle international airlines that, he’s noted in the past, are often heavily subsidized by their governments, handing them an unfair edge. In a September 2025 interview, Kirby observed that foreign-flagged carriers supply two-thirds of seats on flights headed abroad from U.S. airports. Yet around 60% of the passengers are U.S. citizens. Kirby reportedly emphasized to Trump that by attracting a larger proportion of international traffic, this super-carrier would hike American competitiveness and reduce our overall trade deficit. Neither Reuters nor other news organizations reported that Trump expressed a pro or con view on the Kirby idea.

Asked about the proposed prospect of a United acquisition of American at a briefing on April 15, press secretary Karoline Leavitt stated that “It’s not anything we have a position on or are commenting on. I know the idea has been proposed by private industry but it’s not something the President or White House have an opinion on or are weighing in on at this time.”

How do soaring fuel prices play a role in United/American merger interests?

From 2005 to 2016, the U.S. airline industry endured a consolidation wave that reduced the number of major players from nine to the current Big Four, American, United, Delta and Southwest, the group that now controls 80% of the domestic market. In many of those deals, a jump in the price of jet fuel proved the tipping point forcing weaker carriers into the arms of stronger rivals, including America West’s takeover of U.S. Airways (2005), Delta’s acquisition of Northwest (2008), and Southwest’s purchase of AirTran (2011). Since the start of the Iran conflict on February 28, the price of jet fuel has jumped from $100 a barrel to nearly $200. That spike and especially the likelihood that after the conflict ends, costs will remain well above the pre-war level, is hitting the weaklings far harder than than the thriving warriors, especially the two biggest profit makers, Delta and United.

Of course, the leap triggered by the damage to oil infrastructure in the Middle East and closure of the Strait of Hormuz happened after the White House session on Dulles International. But American’s fragile financial state makes it highly vulnerable to any oil shock: In 2025, it earned just $111 million on $55 billion in revenues, and the interest expense on its crushing $37 billion in debt pretty much erased its operating income. By comparison, United posted $3.5 billion in profits on $59 billion in sales, numbers that give it lots of cushion to withstand all rough weather. Like Delta, United’s thrived by luring premium customers, especially the business crowd that pays extra to reserve at the last minute, while American’s struggled in attracting that highly lucrative tier.

Once again, a leap in fuel costs––they represent between 20% and 30% of operating expenses––promises to unleash a new wave of buying that further narrows the roster. As Delta CEO Ed Bastian said on Delta’s Q1 earnings call, “Over my career, I’ve seen many periods of disruption in this industry. And time and time again, high fuel prices have been the most powerful catalyst for change, separating the winners and forcing weaker players to rationalize, consolidate, or be eliminated.” American, the largest airline in the world, is also one of the most vulnerable to the force that more than any other, has reshaped the industry.

How would routes be affected if American merged with United?

A deal would create a colossus potentially wielding much greater power, in far more markets, than any airline ever. As of today, one of the two carriers hold market shares of 44% or more in eleven of the nation’s 50 largest airports. American’s captured 44% in Phoenix, 66% in Miami, 72% in Philadelphia, and 86% in Dallas-Ft. Worth, while United towers at 50% in Denver, 55% in San Francisco, and 75% in Houston. Locking arms would lift their slice of the passenger pies in the New York and Chicago airports, and in LAX, respectively to 45%, 70% and 46%. They’d also rise to number one from lesser status in Honolulu, Ft. Myers, West Palm Beach, Pittsburgh and San Antonio.

A recent report from Raymond James observes that today, American and United respectively command 70% or more of traffic respectively on 35% and 27% of their routes. Prior to any divestitures, United-American would reach or exceed that “highly concentrated” benchmark on around two-thirds of their city pairs.

The rub for passengers and regulators: Airlines make the most money when they’re either a monopoly carrier on a route, or face just one other competitor. Mike Fitzgerald, an analyst for Cowen & Co., projects that the pro-forma carrier would have no fewer than 287 of those metro-to-metro connections. What’s good for United could be a downer for travelers, and traditionally, anything that shrinks the list of rivals linking the same two metros from a longer roster to just one or two raises red flags for regulators.

Let’s get real: How likely is the deal to happen?

The Trump approach to airline consolidation represents a sharp departure from the Biden template. The previous administration quashed JetBlue’s purchase of Spirit in 2024—Spirit then went, and remains bankrupt––and successfully sued to nix a joint venture between American and JetBlue called the Northeast Alliance. By comparison, under the Trump regime Allegiant in mid-March gained antitrust approval for its acquisition of Sun Country after a quick review. The posture of Transportation Secretary Sean Duffy is particularly revealing. In a recent interview on CNBC, Duffy stated that he “sees room” for airline mergers. He also declared that the President “loves big deals,” suggesting that the POTUS might get a kick from green-lighting a biggie in this fabled, super-high-profile sphere.

Still, a United purchase of American would unleash strong opposition from state attorneys-generals who’d fear that their residents would suffer shrunken schedules and pricier tickets. Unions might also rebel since it’s notoriously hard to integrate seniority lists for the likes of pilots and flight attendants. Most of all, even though the Trump Administration favors a lighter regulatory touch, the near-monopoly clout the combination would exert on so many routes might prove a no-go for its DOJ.

But here’s the roadblock that may be decisive, and it has nothing to do with the opposition of regulators, AGs or unions. Duffy has cautioned that a major merger would require that the airlines “peel off some of their assets,” meaning axe gates and landing slots at airports where they hold extremely strong positions. Those requirements would clear the runways for competitors, including low-cost carriers, can ramp the competitive heat. That’s a big negative for United: The obligation to sacrifice many lucrative routes would undermine a lot of the potential benefits of the deal. The acquirer would also need to assume all of American’s massive debt. Yet United wouldn’t be getting full value due to all the carveouts at airports where competition is lowest and its profits potentially the highest. Plus, past cases show that it’s time consuming and expensive to combine reservation and computer systems, and fleets and workforces. So big expenses come up-front, and the benefits of consolidation––which may be minimal considering what’s “peeled off”–may be minimal.

So by conventional standards, the odds are long. On the other hand, the industry’s seldom seen a more daring swashbuckler than Scott Kirby. He’s done it twice before, and he recognizes that if it doesn’t happen under fellow wheeler-dealer Trump, it will never happen. News of Kirby’s proposal to Trump at the White House was a big surprise. A United and American flying under the same flag is probably a surprise too far.

Is Carl Icahn waiting in the wings?

Until all the speculation over United-American erupted, the takeover talk centered around JetBlue. In early 2024, legendary investors Carl Icahn took a 10% stake in the airline, and subsequently won two board seats. The Icahn blueprint typically revolves around buying into troubled targets on the cheap, then putting them in play. Now, JetBlue has reportedly hung out a “for sale” sign. Media reports say the Queens-based carrier’s hired advisers to pitch Alaska Airlines, Southwest and United. At age 90, the wily Icahn must know that the chances that Kirby wins American are long. But the mere size and scariness of that whale may make a United, or another airline’s, bid for JetBlue look harmless by comparison, especially since the Trump Administration’s already shown leniency on the Allegiant takeover of Sun Country.

No one’s talking about Icahn in the scenario making all the noise. But when the condensation trail clears, it could be this seasoned warrior behind the scenes who helps orchestrate the next big sale—a sale that’s part of still another fuel-shock-driven upheaval where the weak performers will need shelter. Who ends up with whom is a game to flummox even the greatest oddsmakers, but the CEO who nailed the jelly bean contest knows that though it’s a long one, he’ll never get a better shot.

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After accepting the reality that its inflation-weary customers had had enough of price increases in recent years, PepsiCo slashed U.S. prices on Lay’s, Doritos, Cheetos, and Tostitos chips by up to 15% in February. It seems to have worked: The move is helping bring back some of the food and beverage maker’s customers who had gone AWOL, according to the company’s latest results.

The company said on Thursday that revenue had jumped 8.5% to $19.4 billion in the first quarter of 2026 compared to the same period a year earlier, noting a strong performance in its North American snacks business. “The consumer is coming back multiple times to our brands,” PepsiCo CEO Ramon Laguarta said Thursday during a conference call with investors.

PepsiCo’s price cuts echoed those of other food companies and restaurant chains in the last year as customers have struggled with food inflation—in some cases reversing the price hikes of the three years after the pandemic. Late last year, General Mills cut prices on nearly two-thirds of its grocery products in North America, helping sales by volume recover. Conagra, Kraft Heinz, and J.M. Smucker also have had to cut prices on some of their products to win back consumers.

Restaurant chains too have had to woo back customers weary of all the inflation of recent years. Earlier this month, McDonald’s announced a budget-focused McValue menu with ten items that each cost under $3, beginning next week. “We absolutely are going to make sure that we are protecting our leadership position in value,” Chief Executive Chris Kempczinski told Wall Street analysts earlier this year. Rivals including Wendy’s and Burger King have also been ramping up the deals.

Though these cuts provide some relief, they won’t get consumers back to the prices of just a few years ago. In the wake of the Covid-19 pandemic that sent ingredient costs way up, food companies have steadily increased prices on a range of items. The U.S. Department of Agriculture found that food prices rose a total of 23.6% between 2020 and 2024. Restaurant prices have risen nearly 30% since 2020, and that restaurant inflation, while much lower now than in 2022, remains above historical averages.

The recent price cuts on food and deals at restaurants suggest a shift in attitude among the CEOs and CFO’s of many companies in these sectors, who were insisting only two or three years ago that customers wouldn’t be deterred by rising prices. It was only in 2024 that many companies started to concede on investor calls that maybe, just maybe, they had overdone the price hikes.

Companies were under enormous pressure from Wall Street to protect profit margins during the inflation run up. But it’s risky to pass along those higher costs: Once you lose a customer who feels gouged or ripped off, it’s very hard to win them back, no matter how much you spend on marketing. That kind of pain can be avoided by companies listening to customers more, and to Wall Street less.

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Activist investor Bill Ackman has his sights set on Universal Music Group, and he’s launched a complex $64 billion proposal for the label behind Bad Bunny, Taylor Swift, Paul McCartney and a long list of other superstars. 

To get his hands on the prize though, Ackman will first have to contend with another big personality: Vincent Bolloré, the 74-year-old secretive French billionaire who controls 28% of Universal through a complex web of holdings.

Known as the “French Murdoch” for building a $14 billion, right-leaning media empire stacked with family members and loyalists, Bolloré is a shrewd businessperson whose ascent to the top tiers of power is an object of fascination and awe in France and throughout Europe. 

“Nine times out of 10 when people are speculating about what Bolloré will do, they get it wrong,” said Nicolas Marmurek, a London-based analyst who specializes in M&A.

Bolloré’s stake in Universal Music Group (UMG), which effectively gives him veto power over any deal, sets the stage for a potentially epic showdown between two of the most powerful figures in the business world. Ackman is famous for fighting his way through deals, launching aggressive campaigns that invest in companies and force management to adopt measures like cutting costs or spinning off assets. Past targets have included Wendy’s and Canadian Pacific Railway but he’s softened his approach in recent years, and he complimented UMG’s management when he launched his bid to merge and relist the company in the U.S. 

Adrian Edwards/GC Images

In bidding to revamp UMG, which owns 30% of the world’s recorded music, Ackman is testing a new playbook. Rather than influencing affairs through pressure tactics Pershing intends to lead a structural recapitalization, buying more shares, putting allies on the board, and re-listing the company in New York while existing management operates the company. It’s all part of Ackman’s broader vision of transforming Pershing into a diversified holding company in the image of Warren Buffett’s Berkshire Hathaway.

That makes winning over the unpredictable Bolloré mission critical for Ackman.

“Without Bolloré, we don’t have a transaction,” Ackman told investors on April 7 when he unveiled the details of his proposal. Ackman said his “first phone call” the day before announcing the deal, was to Bolloré Group, and he reportedly spoke with current chairman and CEO Cyrille Bolloré, Vincent Bolloré’s 40-year-old son. Ackman said he gave the younger Bolloré  a “high-level summary of the transaction.”

“And I guess the words I got back were, ‘These are music to my ears,’” Ackman said. “They are, I would say, intrigued,” he added later. “But of course, the devil’s in the details.”

A complex deal and a long tail

Ackman’s proposed deal is structured as a merger between UMG and a Pershing Square special-purpose acquisition rights company. Pershing Square’s cash commitment is €2.5 billion euro, and a combination of new debt, cash on UMG’s balance sheet, and asset sales will be used to finance the rest of the transaction. But the deal is highly complex and could end up being consummated in several different ways depending on whether UMG shareholders elect to swap their shares for cash or stock in the new entity, or a combination.

If shareholders approve the deal, the new U.S.-listed entity would have a $64 billion equity value once the finances are completed, plus $5.8 billion in new debt on UMG’s balance sheet. Artists would also get what Ackman described as “a nice €750 million euro check” which would come from the sale of UMG’s stake in Spotify.

Yuriko Nakao/Bloomberg via Getty Images

Universal’s board confirmed the proposal the same day as Ackman’s unveiling, describing it as “unsolicited and non-binding.” The UMG board said directors would review it “in accordance with fiduciary duties” and said it had “complete confidence in UMG’s strategy and the leadership of Sir Lucian Grainge.” Grainge has been CEO since 2011, when he led UMG’s acquisition of EMI’s recorded-music catalogue. 

Ackman also pitched refreshing UMG’s board with two new members and naming Hollywood giant and Creative Artists Agency co-founder Michael Ovitz as chair. Ovitz has been friends with UMG CEO Grainge for four decades, Ackman has told investors (Ackman also noted that he’s been friends with Ovitz for 31 years). 

The appeal of UMG for Ackman is in the shift the music industry has undergone throughout much of the past decade. As streaming has transformed the way consumers listen to music, the value of deep catalogs like Universal’s—which includes Billie Eilish, Drake, and Kendrick Lamar—has increased and changed the economics. 

“The tail has become fatter and fatter and fatter,” said Tom Toumazis, MBE and global senior advisor at AlixPartners, describing music that’s more than 10 years old but continues to generate revenue. “A teenager running up that hill with Kate Bush” today is discovering music that didn’t exist a generation ago, he said, referring to the massive resurgence of Bush’s 1985 song “Running up That Hill” following its use in the Netflix show Stranger Things. Every major label has a Kate Bush in its catalogue, he said. The result, said Toumazis, “is an intrinsic reset over a decade that says, this music just keeps on going, and keeps on going, and keeps on going.”

The trend caught Ackman’s eye a few years ago. Pershing previously acquired a 10% stake in UMG in 2021 around the time the label was spun out of French conglomerate Vivendi SE. But Pershing gradually pared its position to 4.5%, and last year, Ackman left UMG’s board as his efforts to convince UMG to list its shares in New York hit a wall. The current deal would see that stake grow to 11.7%.

Because of its Dutch listing, UMG has never had the dedicated analyst coverage that U.S.-listed rival Warner Music Group has and the stock is out-of-bounds for investors with mandates that don’t allow investments in non-U.S. stock, Ackman said in his pitch to UMG. The Dutch listing also keeps UMG outside of major U.S. index funds that buy S&P 500 stocks. He said relisting the company on the New York Stock Exchange would address some of those issues. 

The new structure would generate about $3 billion in incremental cash for Bolloré Group, and the family would retain its UMG stake. According to Ackman, the deal also addresses what he said is part of the reason behind UMG’s recent 39% stock drop from its peak two years ago: The market was uncertain about what the Bolloré family was planning to do with their stake. 

“A very important catalyst was Cyrille Bolloré, the representative from Bolloré Group, surprised the market by resigning from the Universal board,” Ackman told investors in a call this month. “That sort of put in question their intentions with respect to whether they were going to hold their stake.”

The ‘little prince of cash flow’

Fred TANNEAU / AFP) (Photo by FRED TANNEAU/AFP via Getty Images

While much of Ackman’s proposal makes plenty of sense—listing UMG in the U.S., getting passive investment from index fund holders, opening the stock up to investors who can only invest in U.S.-listed entities, no one can predict how Vincent Bolloré will respond, said Marmurek, the M&A analyst. Bolloré is one of the savviest and most secretive investors in France, and trying to gauge how he’ll react is pure speculation, Marmurek said. 

“He’s building a legacy and built a crazy amount of wealth over the space of one generation—he wants that wealth protected,” he said. “Trying to second guess Bolloré is very dangerous.”

Bolloré earned his reputation as an operator after he took over an almost-bankrupt paper mill in the north of France in 1981 at age 29 and turned it into a diversified industrial group including logistics, batteries, ports, and African shipping. The cornerstone of his style as a corporate raider is to take a small stake in an undervalued business and then grind his way to having more and more control. 

Bolloré’s stake in Vivendi, for instance, dates back to 2012 when he picked up a 1.3% stake in the media giant when it bought two of his television stations for less than 500 million Euros. He gradually upped his stake by buying Vivendi shares on the open market, going to 5% in 2012 and 14% in 2015, all the while reaping ever larger dividend payments from Vivendi, according to Le Monde. The French newspaper has given him various nicknames during the past four decades, tracing the arc of his public reputation. In 1988, the paper called him “the little prince of cash flow.” A decade later he was dubbed “the blond angel.” In 2013, the paper called him “a predator.”

Like News Corp founder Rupert Murdoch, Bolloré has infused his collection of media properties with right-leaning, and sometimes controversial, voices. And like Murdoch’s, the Bolloré empire is run like a dynasty. In 2022, Vincent Bolloré passed the leadership baton to his sons Yannick and Cyrille, and stepped down as chairman at age 70. While the patriarch of the family holds no official title at Bolloré SE, behind the scenes his power remains undiminished thanks to  a complex five-layer web of family holdings.

According to Bolloré  SE’s 2025 financial filings, the family’s control runs through a cascade of holding companies with various ownership levels. At the top is Compagnie de l’Odet, where the Bolloré family holds 93% of the shares and Vicent Bolloré  serves as CEO and chairman. In turn, Compagnie de l’Odet owns 71.6% of Bolloré SE, which holds stakes in Vivendi SE, Louis Hachette, Canal+, Havas N.V., and UMG. Through Bolloré SE, the family holds about 18.4% of UMG directly and Vivendi, in which Bolloré is the largest shareholder with a 29.3% stake, owns a further 9.9% of UMG. Combined, their 28% control is large enough that Vincent Bolloré can make or break Ackman’s deal.

And given Bollore’s track record, many observers expect him to drive a hard bargain.

“I struggle to see why Bolloré would jump at the offer without getting something else from Bill Ackman himself,” said Marmurek. “In my view, Bolloré  will want something more. I’m not saying the deal is not going to happen, but it’s a very uncertain deal at this point.”

What does Vincent want?

Negotiations could center around one particular aspect of the complex deal that allows certain shareholders to receive an all cash-payment at a lower valuation. 

According to Le Monde, the deal calls for Pershing Square to spend about €2.5 billion euro on the €9 billion euro cash portion of the deal, but there’s an all-cash route specifically with Bolloré in mind that includes up to €7.5 billion euro at €22 euro per UMG share. That means Bolloré would have to accept a discount in exchange for liquidity, which is a lever he might like to pull, analysts said. 

A potential counteroffer by UMG and its shareholders, including Bolloré, could include a larger cash component, a research note from Paris-based financial services firm Oddo Bhf states. “A consortium could form and propose a higher cash component (50%?) and an equivalent structure with a  listing in the U.S.,” wrote analyst Jérôme Bodin.

At this point, however, “the market considers it unlikely that the current offer will go through and that Bolloré will accept it,” Bodin’s note states. He described the deal as a “massive share buyback financed by UMG’s balance sheet, combined with a relocation of the primary listing to the U.S.” 

To get the deal over the finish line, Ackman will need to draw upon the right combination of charm, persuasion, and resolve—a job that may require exercising new muscles for the 59-year-old hedge fund manager who has made headlines for his brash posts on X, where has 2.1 million followers, and for his adventures on the tennis court (he famously competed in 2025 pro tournament, to mixed reviews).

The big question is whether Bolloré, who has spent his career building an empire, is ready to relinquish some of his control over a prized asset—and if Ackman’s entreaties persuade him that it’s time to cash out or simply convince Bolloré to pursue Ackman’s vision for UMG himself. 

Desmond Kingsford, whose Highwood Value Partners owns shares in Bolloré and Compagnie de L’Ode, questioned why Bolloré would support Ackman’s proposal “when he could push management to do everything Ackman proposes and not dilute any control or ownership?”

“Surely he could sell a few shares at a higher price after management takes those actions if he liked the liquidity aspect of the deal, perhaps in a relisting,” wrote Kingsford in an email.

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The next episode for Netflix? The start of a post-Reed Hastings era. 

The 65-year-old co-founder and former CEO of the world’s largest streaming service announced on Thursday that he won’t stand for reelection to the board at the company’s annual shareholder meeting in June, ending a 29-year run at the company he created in 1997. In a statement included in the first quarter investor letter, the billionaire said he’s leaving to focus on philanthropy “and other pursuits.” He gave shoutouts to co-CEOs Greg Peters and Ted Sarandos, who took full control of Hastings’s executive role in January 2023.  

“A special thanks to Greg and Ted, whose commitment to Netflix’s greatness is so strong that I can now focus on new things,” said Hastings.

While Netflix’s has shown its business can thrive without Hastings in an operating role, the founder’s complete separation from the company is something of an anomaly in the tech world where founders typically remain on the board of directors for years. Nor did the timing of Hastings’ exit—coming shortly after Netflix’s failed attempt to acquire Warner Bros—go unnoticed.

So is Hastings departure related to Netflix’s attempted purchase of the Hollywood movie studio, an analyst asked during Netlflix’s earnings call on Thursday?

Absolutely not, said co-CEO Sarandos.

“Sorry for anyone who was looking for some palace intrigue here, not so,” Sarandos said, in what was Netflix’s first earnings call since it walked away from the deal in February.

Netflix proposed the $27.75 per-share deal for Warner Bros. in January, Warner Bros. accepted, and then in February 2026 Warner Bros. told Netflix that David Ellison’s Paramount Skydance had submitted a better proposal. Paramount Skydance paid Netflix a $2.8 billion termination fee in the deal. 

The analyst who asked the question Thursday noted that Hastings was historically opposed to large acquisitions, but Sarandos said the Netflix founder was fully on-board with the plan to purchase Warner Bros. Discovery’s studios businesses and streamer HBO Max for an enterprise value of $82.7 billion.

“Reed was a big champion for that deal. He championed it with the board, the board unanimously supported the deal, so… that absolutely had nothing to do with it,” Sarandos said.

Shares of Netflix plunged as much as 9% in after hours trading on Thursday, as the company beat first-quarter financial targets but forecast second quarter revenue and profit below Wall Street expectations, according to Bloomberg.

‘We did not lose focus’

Sarandos said the company is looking ahead and not backward.

“At the risk of being a broken record, I just want to remind you that we said this from the beginning, that the WB deal was a nice to have, not a need to have,” Sarandos said during Netflix’s call with analysts. “Our biggest risk was losing focus on our core business while we were working on the transaction, and as you can see from our Q1 results, we did not lose focus.”

Netflix reported net income of $5.3 billion for the first quarter of 2026, up about 82.8% from $2.9 billion a year ago. Revenue rose 16.2% to $12.25 billion. The $2.8 billion from Paramount Skydance boosted the streamer’s free cash flow to $5.1 billion, prompting Netflix to raise its full-year 2026 free cash flow forecast to $12.5 billion, up from $11 billion. 

Sarandos said the company strengthened its “M&A muscle” in designing the bid and working with regulators on approvals. One of the benefits of the exercise was that executives tested their “investment discipline, and when the cost of this deal grew beyond the net value to our business and to our shareholders, we were willing to put emotion and ego aside and walk away.” 

Netflix also detailed three strategic priorities in its investor letter, mapping out its playbook now that the Warner Bros. deal is off the table. The company is focusing on more entertainment, leveraging technology, and improving monetization.

Netflix said it would expand into video podcasts and live events, including the World Baseball Classic in Japan, which drove its single largest day of Netflix signups in the country. It also plans to leverage technology to improve its service, flagging its March acquisition of Hollywood actor and director Ben Affleck’s AI-powered moviemaking tool, InterPositive. 

Netflix is also revamping mobile viewing with a vertical video discovery feed launch planned for the end of April. Its ad-supported price tier represented 60% of all signups in countries where it’s an option and Netflix said it expects $3 billion in ad revenue this year, double its 2025 figures.  

Peters reaffirmed the company’s financial goals of revenue growth of 12% to 14% and operating margin of 31.5%. He said Netflix’s audience is approaching one billion people, which Peters said will be “an exciting milestone to strive for” that leaves it with “plenty of room to grow.” He said Netflix’s market penetration is under 45%.

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Artificial intelligence is becoming increasingly polarizing — not just because of the content it produces or which jobs it might displace, but because many Americans believe it is driving up their electric bills.

Currently, most data centers draw from the public grid rather than securing their own energy sources – a fact that many associate with sky-high electricity prices. Responding to widespread bipartisan concern, President Trump gathered various technology executives at the White House this week to sign a pledge promising not to raise energy prices for consumers. Tech leaders should respond to this momentum by embracing data centers that are co-located with energy sources rather than relying on the grid’s power. Solutions like this will ensure everyday Americans never foot the bill for our country’s AI ambitions.

Most existing data centers are plugged into the grid, so they use the same energy supply on which households depend. When demand grows, utility companies often need to pass on costs of grid upgrades to consumers, so households end up paying more for their electricity. The pledge responds to this reality, but temporarily covering those costs and permanently eliminating them are two different things. There is a logical next step to turn promises into action.

Data centers co-located with their own electricity source place little to no burden on the grid and can do more than prevent cost increases. When their excess electricity eventually connects to the grid, they can bring costs down for surrounding households, and hyperscalers gain the added benefit of being connected to the grid as a backup. The companies that move in this direction where possible – embracing data centers that are co-located with their own power source – can turn their commitments into reality. While residents may still have concerns about industrial neighbors, a facility that does not affect their electricity bills removes a central grievance driving bipartisan efforts to stop building data centers. 

In 2024, more than a third of Americans avoided an otherwise necessary expense so they could afford their electric bills. Last year, regulators across the country approved $11.6 billion in rate increases, which consumers associate with the data center frenzy that can already cause price increases of up to 25% in data center-heavy areas. At least six states – Maryland, Georgia, New York, Oklahoma, Vermont, and Virginia – are considering moratoriums on data center construction. Denver’s mayor has already instituted a similar pause. At the federal level, Sen. Bernie Sanders has called for a national moratorium, while governors Ron DeSantis and Josh Shapiro have both declared that their residents should not pay higher energy bills to power AI.

The White House pledge for tech companies responds to fears of what data center buildouts mean for everyday Americans’ strained wallets. The public’s frustration is a signal that the tech industry should heed.

Last April, during my congressional testimony, I said “our energy system will become the Achilles heel of our AI ambitions.” The statistics should alarm anyone concerned about American AI leadership. Lawrence Berkeley National Lab projects data centers could consume up to 12% of all U.S. electricity by 2028, more than triple their share in 2024. And yet the industry is already falling behind: a recent analysis tracking nearly 800 large projects found up to 50 percent of the capacity slated to come online this year is unlikely to materialize on schedule. Of the roughly 16 gigawatts expected in 2026, only about 5 gigawatts of power generation is currently under construction. The reasons for these delays are varied, but increased electricity bills will continue being a pressing concern for consumers.

To be sure, the industry had already made efforts preceding the White House pledge  to reduce costs for households. Microsoft has committed to pay utility rates that fully cover its data center energy costs; OpenAI has pledged to pay its own way on energy so its operations do not increase electricity prices; and Anthropic has committed to cover 100 per cent of the grid upgrade costs its facilities require. The signing of the White House pledge is a good start and raises the question of what comes next. Companies that avoid relying on the same grid households depend on by co-locating data centers with their energy sources will scale fastest and drive American AI leadership.

Energy will determine whether the United States wins the AI race. Co-locating data centers with their own energy sources is a solution that prevents unnecessary costs for American households while advancing national competitiveness. If people believe a technology is being built on their backs, the backlash that follows is difficult to reverse. With the pledge signed, the window for companies to get this right is still open, but it won’t be for long.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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The common milestones of the American dream once came in rapid succession. Couples would get married, buy a home, and have kids. But low inventory, skyrocketing mortgage rates, and stagnating wage growth have scrambled those milestones for some.

The National Association of Realtors’ (NAR) 2026 Home Buyers and Sellers Generational Trends Report, a survey of 6,103 primary residence buyers from July 2025, found that many Gen Zers—which the NAR defines as those ages 18 to 26—are skipping the chapel and walking straight into a realtor’s office. More than half of Gen Zers today, 53%, are buying homes alone. That figure is more than double the rate at which millennials were buying homes solo at the same age. An NAR study from 2013, the first year NAR released their generational trends report, found that singles comprised just 22% of homebuyers 32 and younger. Out of those Gen Zers purchasing a home, 35% are single women and 18% are single men.

“Gen Zers are absolutely crushing it when we think about singles purchasing homes in this housing market compared to millennials at the same age,” Jessica Lautz, deputy chief economist and vice president of research at NAR, told Fortune.

The trend is the latest data point in the generational reinvention of the path to homeownership. A 2025 Coldwell Banker survey found a staggering 84% of Gen Zers say they’re delaying major life milestones, such as marriage and even career changes, just to afford a home. The age of the median first-time homebuyer hit an all-time high of 40 last year, meaning even the oldest Gen Zers are still over a decade away from reaching homeownership.

National Association of Realtors / 2026 Home Buyers and Sellers Generational Trends

The giant to be sure accompanying this data point is that, as many Gen Zers aim to make homebuying a reality, they still make up a small share of the housing market. The generation accounted for just 4% of all buyers. And the report also found first-time homebuyers composed the smallest share ever recorded since NAR started collecting data in 1981. First-time buyers comprise just about one in five, or 21%, of homebuyers, down from 24% last year.

How some Gen Zers afford a down payment

The housing market overall today is moving at an increasingly sluggish pace. The spring buying season is usually one of the hottest times for the market. But home sales fell 3.6% in March month over month as prospective homebuyers wait on the sidelines for mortgage rates to fall and for affordability concerns—partly driven by higher-for-longer oil prices stemming from the Iran war—to cool down.

For those Gen Zers who have scored a pair of keys, many are taking nontraditional routes to a down payment. About 14% of homebuyers 18 to 26 have consulted a community or government down payment assistance program (DPAP). These financial aid initiatives are usually provided by state or local governments, nonprofits, or lenders, and are designed to cover the upfront costs of purchasing a home to help low-income buyers get a foothold in the housing market. For comparison, the next-highest generation to consult a DPAP for support were young millennials, those ages 27- to 35-year-olds, just 4% of whom used that financial lever. 

About 13% of Gen Zers have received gifts from relatives or friends. That’s less than young millennials, nearly a quarter of whom received gifts, and 13% of older millennials, 36- to 45-year-olds, did too. About one fifth of Gen Z homebuyers used the proceeds from the sale of a primary residence.

Whatever the journey, Lautz said the varied paths to homeownership point to the resilient belief in homebuying as a core tenet of the American dream. “I am encouraged that we are seeing them move into homeownership,” she said. “I do think it speaks to the strength of homeownership being part of the American dream.”

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New York City Mayor Zohran Mamdani marked Tax Day by making good on one of his most prominent campaign promises, and he did it while outside hedge fund billionaire Ken Griffin’s front door.

In a video posted on Tuesday by the NYC Mayor’s Office, Mamdani announced the city’s first-ever pied-à-terre tax: an annual fee on luxury properties valued above $5 million whose owners do not live in New York full-time. The video, which has already drawn nearly 470,000 views and 48,000 likes, was shot outside 220 Central Park South, the building where Citadel CEO Ken Griffin owns a four-floor penthouse he purchased in 2019 for $238 million, then the highest price ever paid for a home in the United States.

“When I ran for mayor, I said I was going to tax the rich,” Mamdani said in the one-minute clip. “Well, today we’re taxing the rich.”

The proposal, which is backed by Gov. Kathy Hochul and still requires approval from the state legislature, would apply to one-to-three-family homes, condominiums, and co-ops worth over $5 million when the owner’s primary residence is outside New York City. Mamdani’s office estimates the tax would generate at least $500 million annually, with revenue directed toward free childcare, street cleaning, and neighborhood safety.

Griffin relocated Citadel’s headquarters from Chicago to Miami in 2022, drawn by Florida’s lack of a personal income tax. He shares the move with Jeff Bezos, Mark Zuckerberg, and Google co-founders Larry Page and Sergey Brin, all of whom recently left high-tax states and now maintain Florida residences. Griffin also recently paid $38 million for a duplex apartment up the block from where Mamdani shot the video, according to the Wall Street Journal.

Mamdani said the tax would fix “a fundamentally unfair system.” “These units are sitting empty,” he said. “And even so, they’re able to reap the huge financial rewards of owning property in, dare I say, the greatest city in the world.”

The pied-à-terre tax has circulated in New York policy circles for years but has repeatedly stalled in Albany. Mamdani recently pushed a wealth tax in New York but said the city would be forced to instead increase property taxes if the tax didn’t get state approval. Neither Griffin nor the Mayor’s Office responded to Fortune’s request for comment.

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Carnival Cruise Line must pay $300,000 to a former passenger after a federal jury in South Florida found that the company was negligent in serving the woman more than a dozen shots of tequila before she fell down some stairs and suffered a possible traumatic brain injury.

The Miami federal jury decided last Friday in favor of Diana Sanders, a 45-year-old nurse from Vacaville, California.

“Taking on a corporate giant like Carnival is a massive undertaking, and I have enormous respect for my client’s resilience throughout this 18-month litigation,” Sanders’ attorney Spencer Aronfeld said in an email. “This case highlights the inherent dangers of all-inclusive drink packages, which encourage excessive consumption and pressure underpaid servers to prioritize tips over safety.”

A statement from Carnival Corporation said it respectfully disagrees with the verdict and believes there are grounds for a new trial and appeal, which it will pursue.

According to the lawsuit, Sanders was a passenger aboard the Carnival Radiance on Jan. 5, 2024, when was served at least 14 shots between approximately 2:58 p.m. and 11:37 p.m. She experienced a fall some time between 11:45 p.m. and 12:20 a.m. that caused her to suffer a concussion, headaches, a possible traumatic brain injury, back injuries, tailbone injuries, bruising and other injuries, the complaint said.

Aronfeld said jurors were presented with evidence of 30 minutes of missing surveillance video from the time Sanders left the Casino bar until she was found unconscious in a crew only area.

In a separate case that is still ongoing, the fiancée of a man who died on a cruise ship filed a wrongful death lawsuit last year against Royal Caribbean, alleging it negligently served him at least 33 alcoholic drinks and was liable for his death after crew members tackled him to the ground and stood on him with their full body weight.

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FIFA President Gianni Infantino said Wednesday that Iran will participate in the World Cup “for sure” despite its war with the United States.

Speaking at CNBC’s Invest in America Forum, Infantino said it is important that Iran participates in the World Cup even though its participation has been in doubt since the U.S. and Israel launched airstrikes on the country.

“The Iranian team is coming for sure, yes,” Infantino said. “We hope that by then, of course, the situation will be a peaceful situation. As I said, that would definitely help. But Iran has to come. Of course, they represent their people. They have qualified. The players want to play.”

Infantino met with the Iranian national team in Antalya, Turkey, two weeks ago and said Wednesday he was impressed.

“I went to see them. They are actually quite a good team as well,” Infantino said. “And they really want to play and they should play. Sports should be outside of politics now.”

Infantino acknowledged it’s not always possible to achieve the separation of sports and politics.

“OK we don’t live on the moon, we live on planet Earth,” Infantino said. “But you know if there is nobody else that believes in building bridges and in keeping them, you know, intact and together, well we are doing that job.”

The United States will co-host the World Cup with Canada and Mexico.

Iran is scheduled to play two group-stage games in Inglewood, California, and one in Seattle.

The war has raised doubts about Iran’s participation in the World Cup. There have been conflicting public comments from Iranian government and soccer officials. U.S. President Donald Trump discouraged the Iranian team from attending the tournament, citing safety concerns.

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America’s $39 trillion national debt has become a familiar political football—batted around in budget negotiations, invoked at congressional hearings, and largely ignored between elections. But what the International Monetary Fund laid out Wednesday is something more unsettling: The U.S. isn’t an outlier. It’s just the most visible symptom of a global disease.

At the spring launch of its biannual Fiscal Monitor, IMF Fiscal Affairs Director Rodrigo Valdez opened with a stark framing: “The world economy is being tested again with the consequences of the war in the Middle East—and this is a world that has less degrees of freedom as public finances are more stretched in many, many countries.”

The fund projected global public debt will hit 99% of world GDP by 2028, breaching the 100% threshold sooner than previously forecast. Under stress scenarios representing the 95th percentile of plausible outcomes, that figure could spike to 121% within three years.

America’s tab keeps growing

The U.S. remains the marquee case study in fiscal dysfunction. Washington’s deficit narrowed slightly last year—from close to 8% to below 7% of GDP—partly boosted by tariff revenues flowing into federal coffers, but the improvement was fleeting. “Our forecast is that this deficit goes back to around 7.5% and stays there for the near future,” Valdez told reporters, with U.S. debt now on track to exceed 125% of GDP this year and potentially 142% by 2031.

The adjustment needed to simply stabilize—not reduce—that trajectory would require fiscal tightening of roughly 4 percentage points of GDP. “That is not minor, of course,” Valdez said. It would rank among the largest peacetime fiscal adjustments in modern American history. Already, warning signals are flickering in bond markets. The premium U.S. Treasuries once commanded over other advanced-economy debt is narrowing. “These are signs that markets are not as sanguine—as forgiving—as they were in the past,” Valdez said. “The more time passes, the more pressure you could face down the road.”

His message to Congress was direct: “This cannot wait forever.”

The whole world is overdrawn

Washington’s problem looks almost manageable next to the global picture. The fiscal gap—the distance between where countries’ primary balances actually sit and where they need to be to stabilize debt—has worsened by roughly one percentage point compared to the five years before COVID.

“This is not just a cyclical problem,” Valdez said flatly. “It basically reflects policy choices—permanently higher spending and lower revenues.” Real interest rates are now running some 6 percentage points above pre-pandemic levels, compounding the burden of every existing dollar of debt. Every year of delay makes the eventual reckoning more severe.

The energy trap making it worse

The ongoing Middle East conflict is adding a fresh dimension of fiscal temptation—and danger. As fuel and food prices climb, governments are reaching for a politically easy but economically toxic tool: broad-based energy subsidies and excise tax cuts. The IMF didn’t mince words.

“Broad-based energy subsidies or excise reductions are not the best tool,” Valdez said. “They distort price signals, are fiscally costly, regressive, and hard to unwind.” Worse, when half the world shields consumers from higher energy prices, the remaining half absorbs all the demand adjustment. “Domestic policies affect global prices,” Valdez warned—and IMF modeling suggests the spillover effect could effectively double the original price shock for countries that don’t subsidize.

IMF Deputy Director Era Dabla-Norris noted governments’ response this time has been “much more restrained” than during the 2022 energy crisis, but cautioned that with fiscal space now “much more constrained,” the costs of reverting to old habits would be severe. The fund’s prescription: protect people, not prices—targeted, temporary support for the most vulnerable, not blanket relief for everyone.

AI: The wildcard that could change everything

In a briefing otherwise defined by grim arithmetic, artificial intelligence emerged as the closest thing to a lifeline. Dabla-Norris said AI could fundamentally transform how governments operate by boosting productivity, tightening tax administration, and improving delivery of health and education services: “It can be used to fundamentally reshape the way governments do their business.”

But the technology cuts both ways. AI concentrates wealth, disrupts labor markets, and could quietly hollow out the income-tax and payroll-tax bases that modern social contracts depend on. “Are our current tax systems—are our current social protection systems—fit for purpose?” Dabla-Norris asked, a question she said every government needs to urgently answer. “Because there’s a lot of uncertainty in the way AI will play out … what actual impact it will have on labor markets, what actual impact it will have on inequality. So the challenge for government is really to see whether their systems are adaptable and that they can meet the risks that it portends.”

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.

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China has taken a bite out of the U.S.’s lead in artificial intelligence.

The country has nearly closed its gap to the U.S. in AI bot performance, while continuing to best global competition in number of patents, publications, and rollout of robots, according to Stanford University’s Institute for Human-Centered Artificial Intelligence (HAI) 2026 AI Index report released this week.

The report found a shrinking gap in Arena scores—a metric indicating relative performances of large-language models—between the top AI bots in the U.S. and China. In May 2023, the U.S.’s top model, OpenAI’s GPT-4, led with more than 1,300 Arena points compared to China’s fewer than 1,000. By March 2026, that gulf shrank to just 39 Arena points, with the top U.S. model, Anthropic’s Claude Opus 4.6, leading China’s Dola-Seed 2.0 by just 2.7%.

While the U.S. still beats China in the number of top AI models—50 compared to 30—China has more publication citations than the U.S., accounting for 20.6% of AI citations in 2024 compared to the U.S.’s 12.6%. China also has nearly nine times the volume of industrial robot installations, leading the world with more than 295,000, compared to the U.S.’s 34,200.

“For years, the U.S. outpaced all other global regions on AI—in model size, performance, artificial intelligence research, citations, and more,” said Stanford’s summary of the report. “But China emerged as an AI counterweight to the U.S., gradually gaining ground, and this year it appears to have nearly erased any U.S. lead.”

China’s AI surge

Despite fewer investment dollars and wider regulatory constraints, China has changed the narrative of its ability to compete against the U.S. in a broader tech war. Spurred by its 2025 “DeepSeek moment,” China has poured funding into AI startups, with IPOs in Hong Kong last quarter reaching a five-year high of $110 billion across 40 new listings.

China has also quietly invested in its electricity infrastructure, adding more electricity demand than the entire consumption of Germany every year, David Fishman, a China energy analyst with the Lantau Group, previously said in an interview with Fortune. The country’s reserve margin has never dipped below 80%, Fishman said, essentially giving it twice the necessary capacity to grow AI compute.

China’s compute capacity is a far cry from the U.S.’s own ability to sustain and grow AI infrastructure. The American power grid system is crumbling as a result of decades of underinvestment, making it vulnerable to extreme weather and natural disasters, and ultimately creating a bottleneck Goldman Sachs suggests would stymie AI growth in the U.S. 

“We’ve actually reduced our exposure to U.S. tech,” Mohit Kumar, Jefferies’ global macro strategist, told Fortune at the bank’s Asia Forum in Hong Kong last month. “We believe that China is the big winner in this tech war for a number of reasons: valuation, wider adoption of AI, an advantage in power generation.”

American private investment in AI still far exceeds China, reaching $285.9 billion in 2025, more than 23 times greater than China’s $12.4 billion. The U.S. funded 1,953 new AI companies last year, more than 10 times any other country, the Stanford report noted.

America’s slowing AI brain gain

AI’s momentum swing in China’s favor may be contributing to a slowdown in tech talent entering the U.S. The Stanford report found the number of AI scholars moving to the U.S. dropped 89% since 2017, and that decline is happening precipitously, accelerating 80% in the last year alone. At this juncture, more researchers are still entering the U.S. than leaving it.

“The U.S. is home to the most AI researchers and developers of any country by far,” the report summary said. “But the flow of these experts into the country is dramatically slowing.” 

Economists have warned a continued loss of expertise would further erode the edge the U.S. has over China in its talent pool. An April 2025 Hoover Institute report conducted in partnership with Stanford HAI found China has built a massive cohort of homegrown talent, with nearly all researchers behind DeepSeek’s five foundations papers educated or trained in China. Though about a quarter of DeekSeek researchers were educated in U.S. institutions, most returned to China, creating a “one-way knowledge transfer” in China’s favor, according to the report.

“These talent patterns represent a fundamental challenge to U.S. technological leadership that export controls and computing investments alone cannot address,” the authors wrote.

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President Donald Trump’s war of words with Pope Leo XIV has earned a strong rebuke from leading Catholic Church figures at home, and has threatened to splinter a voting bloc he dominated in 2024. 

Catholic bishops and leaders from across the country have spent the week reacting to Trump’s repeated attacks directed at the pope, who last week criticized the president’s plans to target Iranian civil infrastructure as “truly unacceptable.” Earlier in April, during Easter Mass, Pope Leo had made an explicit call for “those who have weapons” to cease hostilities and seek peace.

Trump did not take kindly to the pontiff’s criticisms. In a social media post Sunday, the president called Pope Leo “weak on crime” and framed his views as liberal. Trump also claimed the first American pope elected to the position should be thankful to him, stating: “If I wasn’t in the White House, Leo wouldn’t be in the Vatican.”

Past conflicts between the president and the pope

It isn’t the first time a U.S. president has verbally sparred with a sitting pope. During his first term, Trump verbally sparred with Pope Francis, Leo’s predecessor, over his border wall plans. In the 1990s and 2000s, Pope John Paul II debated presidents on the moral merits of sensitive topics including abortion and stem cell research.

But the spat between Trump and Pope Leo has drawn routine condemnation from many influential religious voices in the U.S., a concerning sign for Republicans ahead of the November midterms, as the party’s base grows increasingly fractured over the war’s fallout.

“I am disheartened that the President chose to write such disparaging words about the Holy Father. Pope Leo is not his rival; nor is the Pope a politician,” Archbishop Paul Coakley, president of the U.S. Catholic bishops’ conference, wrote in a statement on Sunday.

Many prominent Church voices sided with Pope Leo’s call for peace. Archbishop Gregory Hartmayer of Atlanta this week reaffirmed the pope’s call to “lay down weapons, choose dialogue, protect innocent life.”

Even proclaimed Trump allies have criticized the president’s choice of words, such as Bishop Robert Barron of Winona-Rochester, who this week called Trump’s comments “entirely inappropriate and disrespectful,” adding “the President owes the Pope an apology.” 

As the week progressed and Trump escalated his rhetoric toward Pope Leo, more recriminations came in. Many criticized an AI-generated image, shared by Trump, depicting the president as a healing figure resembling Jesus Christ. Trump later attempted to play down the comparison while refusing to apologize to the pope, but Catholic leaders nonetheless protested loudly against the post, which was later removed.

The Ancient Order of Hibernians, the country’s largest organization of Irish Catholics, released a statement Tuesday saying the image had “amplified the offense” of Trump’s original remarks, calling the act “sacrilege and a defamation of the faith.”

“When a president mocks the Vicar of Christ and then cloaks himself in Christ’s image, he has left the realm of politics entirely,” the statement read. “He has committed an act of desecration against a faith held sacred by over a billion souls.”

What is a just war?

Trump’s clash with the pope has reignited debates in certain factions of the president’s party over what constitutes a religiously justified war. Administration officials including Defense Secretary Pete Hegseth have used the language of a just war to promote the campaign in the Middle East, which is currently on pause as part of a negotiated ceasefire. 

But spiritual voices in the country are less convinced. Bishop James Massa, chairman of the U.S. Catholic bishops conference, wrote on Wednesday a nation can only be said to be waging a just war, as defined by the Catholic Church, when it acts “in self-defense, once all peace efforts have failed.” 

“That is, to be a just war it must be a defense against another who actively wages war,” Massa wrote.

The fissure between the administration and religious authorities risks driving a wedge between Trump’s party and a potentially crucial voting bloc ahead of next fall’s midterms. Catholic voters went for Trump in 2024, when he took 55% of that demographic’s vote to then-Vice President Kamala Harris’ 43%. Catholics have proven to be a formidable swing group in elections, and according to exit polls, comprise around one in five voters. In 2020, former President Joe Biden won with 50% of Catholics to Trump’s 49%.

For his part, Pope Leo affirmed this week he had “no fear” of the Trump administration and he would continue to speak out against the war. With a growing cohort of prominent Catholic voices joining him, what started as a verbal spat has escalated into a theological debate involving large swathes of the American electorate, at one of the worst possible times for the Republican Party.

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Hello and welcome to Eye on AI. It’s Beatrice Nolan here, filling in today for AI reporter Sharon Goldman. In this edition…OpenAI debuts its own highly-capable cybersecurity model…Anthropic launches Claude Opus 4.7…a startup wants to use AI to evaluate journalism in a way that freedom of the press advocates fear will chill reporting that relies on whistleblowers.

On Friday, a man hurled a Molotov cocktail at the gate in front of OpenAI CEO Sam Altman’s house. Daniel Moreno-Gama, 20, from Spring, Texas, was arrested on suspicion of the attack an hour later. At the time, he was outside OpenAI’s headquarters, allegedly trying to smash his way in with a chair.

On Sunday, two more people were arrested after a gun was fired near Altman’s property (it remains unclear whether that shooting was targeting Altman in any way).

Online, some have laid the blame for the attacks at the door of so-called “AI doomers”—those who believe AI poses an existential threat to society. And while it’s true the man accused of attacking Altman’s home had a manifesto warning of humanity’s “extinction” at the hands of AI, it’s also true that a less extreme, but extremely broad-based, anti-AI sentiment has been building for years.

People are increasingly aware of, and concerned about, the technology’s environmental impacts, automation of jobs, and AI use in warfare. Then there are the cases of psychological harm linked to the technology which have already generated wave of lawsuits that blame the tech for multiple deaths, including those of teenagers. Some people, particularly those who grew up during the rise of social media, are also increasingly worried about the potential of becoming addicted or too reliant on AI tools.

Part of this is a messaging problem, one that is often fueled by the AI labs themselves. For years, tech executives have been touting AI as a dangerous technology. It could help people perpetrate cyberattacks, build bioweapons, and almost certainly lead to mass unemployment. Oh, and it also just might, lead to human extinction. Just last week, Anthropic launched its “Mythos” model, which it said was too dangerous to be in public hands. (In this case, that fear might be justified. But fear, it turns out, is also pretty effective marketing—it’s hard to think of another consumer product whose makers have so consistently warned the public that it might destroy civilization.)

Either way, it seems the public has been listening.

Low poll numbers

A March NBC News poll found just 26% of voters hold positive views of AI, versus 46% who hold negative ones—only the Democratic Party and Iran were less popular.

Anti-AI sentiment is particularly sharp among the younger generation, who are already dealing with a tough job market. A Gallup poll published last week found Gen Z excitement about AI collapsed from 36% to 22% in a single year, while anger rose from 22% to 31%—driven, Gallup said, by fears the technology is killing off entry-level jobs.

It’s debated how much AI is to blame for the tough labour market for recent graduates or whether it’s just a convenient excuse for layoffs and hiring reductions in a tough economic climate. But after years of executives citing the tech for headcount reductions, the public seems to have accepted the narrative.

The negative environmental consequences of AI also resonate with the public. Between April and June 2025 alone, 20 proposed data center projects worth a combined $98 billion were blocked or delayed due to local resistance. Communities have raised concerns over the strain on local energy grids, rising electricity bills, and the vast amounts of water required to cool the facilities, not to mention the dust and light pollution created during the construction of these massive facilities. (The water consumption of most AI data centers may not be as high as some initial estimates asserted, but the idea that AI consumes vast quantities of water has stuck in the public imagination. It is also true that in some places data centers have, in fact, hurt local water supplies and that entire life cycle of AI chip production consumes a lot of water.) This anger has grown loud enough to shift legislative agendas, with New York State recently proposing a three-year moratorium on new data center permits.

Altman may be paying a price for being the most visible face of the AI industry. Ask most people outside major hubs to name an AI company, and the answer is almost always OpenAI (or, “that company that made ChatGPT”)—if they can name one at all. Notably, the attacks on Altman were not the first security incident at OpenAI. In November, employees were told to shelter in place after a man threatened to carry out attacks on staff at its San Francisco offices.

AI insiders belatedly admit they have an image problem

Even within the labs, some employees are starting to acknowledge their companies might have a marketing problem. Roon—widely believed to be a pseudonym for OpenAI researcher Tarun Gogineni—posted this on X earlier in the week:

“The ai labs, in competing with each other, are burning huge amounts of the commons on public trust in ai to win minor points against the others. their lobbyists, pr machines, lawsuits. it’s the very opposite of what marxist class struggle analysis would tell you”

While the labs have done a pretty good job of making AI feel ubiquitous, they’ve done a far worse one of making it feel worthwhile to everyday people. Most people understand that AI can help you write emails faster or optimize some workflows, but far fewer know it’s being used to accelerate drug discovery (and to be fair to the public, no drug created with AI has yet to make it to market, although dozens are now in the pipeline), model climate change, or diagnose rare diseases.

Until that changes, the gap between what the industry believes it’s building and what the public thinks it’s getting will keep widening.

With that, here’s more AI news.

Beatrice Nolan
bea.nolan@fortune.com
@beafreyanolan

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The same week Americans recorded a 74-year low in economic pessimism, Wall Street’s biggest banks closed their most lucrative trading quarter since at least 2014. 

The S&P 500 punched through 7,000 to a fresh all-time high. Goldman Sachs posted its second-highest quarterly revenue on record. Morgan Stanley’s equities desk set a record of its own. JPMorgan, Bank of America, and Citigroup all notched records in stock trading.

Wall Street is riding high on the coattails of the war in Iran. But Main Street feels like it’s drowning in it. Much has been written about the K-shaped economy, but there’s something tangibly different about this particular divergence: it’s happening at a time when President Donald Trump and his cabinet are sowing enormous uncertainty and volatility around the war, and isn’t it classic wisdom that Wall Street is allergic to uncertainty? How could a conflict that has shut down one of the world’s most important oil chokepoints for months and triggered what the IEA keeps calling the worst energy crisis ever, not hinder the bull run.

While analysts puzzle over the question, many online say they already have the answer: Trump is manipulating the markets. What finance types call “jawboning” looks, to the average person scrolling X, like clear evidence of a president riling markets up over the weekend to create a dip—one that smart money (and Trump-associated insiders, these arguments go) will buy and ride to the top. But one top economist says the answer is simpler than that.

“Stock markets respond to risks shifting around,” said Claudia Sahm, chief economist at New Century Advisors and inventor of the famous Sahm rule for recessions. “Households respond to reality.”

Volatility is the product

Since the post-2008 financial reforms, Wall Street’s trading desks have been rebuilt around client facilitation. They don’t make money when markets go up; they make money when clients trade. And clients trade when prices move—it doesn’t matter the direction. The Iran war, the oil shock, the Liberation Day whiplash, the Greenland threats, and the Venezuela operation: each is a reason for an institutional investor to pick up the phone and reposition. Volatility is the product.

That’s how you get a week in which Bank of America’s stock-trading desk posts its highest quarterly revenue in nearly two decades, Morgan Stanley’s equities desk sets a record, Goldman beats estimates, and the five banks collectively are on track for more than $40 billion in first-quarter trading revenue, roughly 13% above last year. 

The consumer has no equivalent machinery. The University of Michigan’s preliminary April reading came in at 47.6, a 10.7% drop from March and the lowest in the index’s history, worse than the June 2022 trough that Republicans used as a cudgel against Biden for two straight election cycles. The decline cut across age, income, and party. 

And Sahm told Fortune the gloom isn’t just about this spring.

“It’s not just about the last hit to their finances,” she said. “It’s a period of time over the last five years—there’s just been one disruption after another, and it builds up.”

Americans are exhausted by inflation, the pandemic, the 2022 inflation surge, and the tariffs. And now, a war that pushed gas to a national average of $4.16. While the stock market zooms out to a 12-month horizon, the consumer is stuck in the lived reality of the status quo. 

Who actually owns the rally

It’s also worth asking who, exactly, is long the S&P at 7,000. The wealthiest 10% of American households own roughly 93% of equities. Bank of America’s own research team published a chart this week that drew the K in its starkest terms: Discretionary spending among higher-income households is actually rising, buoyed by tax refunds from last year’s One Big Beautiful Budget Act, while lower-income households are getting squeezed by gas prices they can’t absorb. 

“The gas price shock puts greater strain on discretionary spending by lower-income households,” BofA analyst Shruti Mishra wrote, “since they spend a larger share of their income on gas, and save less.” 

There’s one word we’ve heard trading desks use to describe consumers through all the inflation hikes: resilient. It is true consumers have miraculously buoyed the economy by spending throughout it all. But that lift isn’t lasting forever. Goldman Sachs cut its 2026 consumption growth forecast from just over 2% to 1.2%, citing the hit to real disposable income from higher gas prices. 

“The consumer is not as resilient as it was back when Russia invaded Ukraine,” Sahm said. “That was a much stronger labor market. Consumer balance sheets were better. That’s just not the case now.”

Which raises another question: If the American consumer is running out of road, and the S&P’s forward earnings estimates assume she isn’t, what happens when the two have to meet? “We’re in a place where there’s enough broad-based slowing that I expect this to make a dent in consumer spending,” Sahm said. “That could be a speed bump for the stock market, and that is not my impression of what is baked into the earnings estimates.”

The market manipulation question

And then there is the question that social media is obsessed with: “market manipulation.” Sahm is careful with the term.

“That’s a very specific thing,” she said; it denotes whether or not someone on the inside can time trades based on the information they exclusively have.

And to be sure, insider trading may have been part of some of the big swings. The Commodity Futures Trading Commission is investigating at least two instances where oil futures volume surged in the minutes before Trump announced major Iran policy pivots, according to Bloomberg. 

But broadly, of the question of jawboning, Sahm says it’s not so unusual.

“There is a conversation he’s having with markets, and he’s listening to markets,” she said of the president. Trump’s maximalist style—threaten annihilation, then walk it back, then threaten again—has trained investors to buy the dip on the retreat, because the retreat always comes.

“Investors who missed out on the post-Liberation Day recovery because they got scared don’t want to miss out this time,” Sahm said. “As soon as it looked like the worst case was off the table, the stock market was just off and running.”

But Sahm offered one note of caution that runs counter to the rally.

“I kind of worry about the day where markets completely ignore him,” she said, “because then we’re in a place where this has really gone off the road.”

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Pakistan’s army chief met with Iranian officials in Tehran on Thursday in a bid to ease tensions in the Middle East and arrange a second round of negotiations between the United States and Iran after almost seven weeks of war.

Meanwhile, U.S. President Donald Trump announced a 10-day pause in fighting between Israel and Lebanon starting on Thursday at 5 p.m. ET, following “excellent” conversations he had with each nation’s leader. Trump also said he’s inviting Israeli Prime Minister Benjamin Netanyahu and Lebanese President Joseph Aoun to the White House for the leaders’ first direct talks in over 30 years. Nearly 2,200 people in Lebanon have been killed by Israeli air strikes.

The U.S. naval blockade of Iranian ports continued as U.S. Treasury Secretary Scott Bessent said the Trump administration would ramp up economic pain on Iran with new economic sanctions on countries doing business with it, calling the move the “financial equivalent” of a bombing campaign.

The White House said any further talks with Iran would likely take place in the Pakistani capital of Islamabad, though no decision had been made on whether to resume negotiations. Pakistan has emerged as a key mediator after it hosted direct talks between the U.S. and Iran in Islamabad.

In a development in the war’s other front, Trump wrote late Wednesday on Truth Social that leaders from Israel and Lebanon would speak the next day in a renewed effort to broker a ceasefire after the countries’ first direct talks in decades ended the previous day in Washington without a deal.

Here is the latest:

Trump says $4 a gallon gas ‘not very high’ given importance of stopping Iran from getting a nuclear weapon

The U.S. president played down prices at the pump averaging $4.09 a gallon nationwide, saying the cost wasn’t so great relative to the risk of evening higher prices tied to keeping Iran from getting a nuclear weapon.

“Well, they’re not very high, if you look at what they were supposed to be in order to get rid of a nuclear weapon,” Trump told reporters about gas prices before a planned trip to Las Vegas.

The president repeated a past claim that he thought the war with Iran would have driven energy costs much higher.

Gas prices are up roughly 29% from a year ago, according to AAA.

Netanyahu says he has agreed to 10-day ceasefire in bid ‘to advance’ peace efforts with Lebanon

Israeli Prime Minister Benjamin Netanyahu says he has agreed to a 10-day ceasefire in Lebanon.

In a video statement, Netanyahu said he was taking the step in an attempt “to advance” peace efforts with Lebanon.

Israel and Lebanon opened negotiations this week in Washington aimed at forging a peace agreement. The Hezbollah militant group, which has been fighting Israel for six weeks, has said it opposes the dialogue.

“We have an opportunity to make a historic peace agreement with Lebanon,” Netanyahu said.

Italian premier hails Israel-Lebanon ceasefire as ‘excellent news’

Italian Premier Giorgia Meloni greeted the announcement of a ceasefire between Israel and Lebanon as “excellent news,” achieved “thanks to the mediation of the United States.”

She added that the ceasefire must be fully respected, singling out Hezbollah “for having started this conflict,” and expressed hope that it would create conditions for talks leading “to a full and lasting peace” between Israel and Lebanon.

Italy has the second-largest contingent of U.N. peacekeepers serving in southern Lebanon.

Hezbollah reacts to ceasefire announcement

Hezbollah said in a statement that “any ceasefire must be comprehensive across all Lebanese territory and must not allow the Israeli enemy any freedom of movement.”

Israel offered no official comment on Trump’s announcement.

Hezbollah added that “Israeli occupation on our land grants Lebanon and its people the right to resist it, and this matter will be determined based on how developments unfold,” a stance that could complicate the ceasefire.

Israel has staged a ground invasion in southern Lebanon, where its forces have been engaged in fierce battles with Hezbollah militants in the border area. It is unclear whether Israel would withdraw some or all of its forces as part of the truce.

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Northern Israeli leaders criticize proposed Lebanon ceasefire

Two local leaders in northern Israel criticized a proposed ceasefire with Lebanon, warning it would leave communities vulnerable.

Moshe Davidovich, head of the Mateh Asher Regional Council, said agreements may be signed in Washington but “the price is paid here in blood, in destroyed homes and shattered communities.”

He warned that a ceasefire without strict enforcement against Hezbollah and a buffer zone up to the Litani River, some 30 kilometers (18.64 miles) north of the Israeli border, would amount to “waiting for the next massacre.”

Eitan Davidi, head of the Margaliot moshav, called the move “a surrender” and “a political defeat.” He told the N12 news site it was made without coordination with northern residents and contradicts the stated goal of dismantling Hezbollah’s capabilities.

China’s UN envoy calls US blockade of Strait of Hormuz ‘a dangerous and irresponsible move’

Ambassador Fu Cong said the strait “should be safeguarded” for international navigation and called on Iran to take ‘proactive measures’ to open the waterway, used to ship about 20% of the world’s oil.

“The issue of navigation in the Strait of Hormuz is a spillover effect of the conflict in Iran,” he said. “Only a complete ceasefire can fundamentally create conditions for easing the situation.”

Fu told the U.N. General Assembly on Thursday that Beijing is engaged “in intensive mediation with all parties to actively promote talks for peace”’ and an end to the war in Iran.

The 193-member world body was meeting to hear China and Russia explain why they vetoed a Security Council resolution backed by the U.S. and Gulf nations aimed at opening the Strait of Hormuz.

Fu claimed the resolution would have given “a carte blanche for the continuation of aggressive actions and further escalation” rather than de-escalate the conflict and promote negotiations.

Lebanese prime minister welcomes Trump announcement of ceasefire

Prime Minister Nawaf Salam said the ceasefire was Lebanon’s first goal in landmark talks that took place with Israel in Washington on Tuesday between the country’s ambassadors to the U.S.

“While I congratulate all Lebanese on this achievement, I offer my condolences to the families of the martyrs who fell, and I affirm my solidarity with their families, with the wounded, and with the citizens forced to flee their cities and villages,” Salam said.

Trump said he’ll invite Aoun and Netanyahu to continue diplomatic talks at the White House

Trump said it would be “the first meaningful talks between Israel and Lebanon since 1983.”

“Both sides want to see PEACE, and I believe that will happen, quickly,” Trump wrote on his Truth Social platform.

Lebanon and Israel signed an agreement in 1983 saying Lebanon would formally recognize Israel and Israel would withdraw from Lebanon. The deal fell apart during Lebanon’s civil war and was formally rescinded a year later.

Iranian official criticizes US economic threats

Iran’s foreign ministry spokesperson Esmail Baghaei criticized economic threats by U.S. Treasury Secretary Scott Bessent, saying they harm “innocent people” and reflect an “inhumane mindset.”

“These are nothing short of economic terrorism and state-sponsored extortion,” he wrote on X, referring to Bessent’s Wednesday remarks about potentially carrying out the “financial equivalent” of a bombing campaign.

US releases list of contraband Iranian goods

The U.S. military has released an expansive lists of goods it considers contraband as part of its blockade of Iran and declares it will seize from merchant vessels “regardless of location.”

In a notice published Thursday, the U.S. military says any “goods that are destined for an enemy and that may be susceptible to use in armed conflict” are “subject to capture at any place beyond neutral territory.”

The list includes items like arms, ammunition and military equipment that are classified as “absolute contraband.” However, it also lists items like oil and iron, steel, and aluminum as well as some civilian goods, as “conditional contraband” and argues these items can be put to military use.

The notice says that otherwise innocuous items like electronics or heavy machinery can be seized if “circumstances indicate intended military end-use.”

14 ships turn around from the Iran blockade, US military says

U.S. Central Command says those vessels have turned around in the first three days of the blockade on Iranian ports at the direction of American forces.

At a Pentagon news briefing earlier Thursday, U.S. defense leaders said more than 10,000 American troops are helping enforce the blockade on Iranian ports and that no ships have yet needed to be boarded.

Trump announced a 10-day ceasefire between Israel and Lebanon on social media

He said it followed “excellent” conversations he had with Lebanese President Joseph Aoun and Israeli Prime Minister Benjamin Netanyahu.

Lebanon and Israel held their first direct diplomatic talks in decades Tuesday in Washington after more than a month of war between Israel and the Iran-backed Hezbollah militant group.

Trump said he’s directed U.S. Vice President JD Vance others to work with Israel and Lebanon to “achieve a Lasting PEACE.” He added: “so let’s, GET IT DONE.”

Trump calls Lebanese president in ongoing diplomatic scramble over war between Israel and Hezbollah

The office of Lebanon’s President Joseph Aoun said President Trump was thanked by the Lebanese head of state to reach a ceasefire in the devastating war.

Aoun earlier spoke to U.S. Secretary of State Marco Rubio where he refused to have a direct call with Israeli Prime Minister Benjamin Netanyahu and has insisted on achieving a ceasefire ahead of continued direct talks. Israel hasn’t made a decision regarding a ceasefire.

The statement said Trump stressed “his commitment to fulfilling the Lebanese request for a ceasefire as soon as possible.”

Neither the State Department nor the White House immediately issue a statement on the calls with the Lebanese president.

More on why Lebanese President Joseph Aoun declined to talk with Israel’s Benjamin Netanyahu

A second Lebanese official said Aoun explained to U.S. Secretary of State Marco Rubio that direct talks with Netanyahu at this point would be inappropriate given the ongoing airstrikes and destruction in Lebanon and the lack of a ceasefire in place.

The official also spoke on condition of anonymity because of the sensitivity of the situation.

— Kareem Chehayeb

Fuel costs and labor strife lead Lufthansa to shut down CityLine feeder airline

Lufthansa said Thursday that labor disputes and high fuel prices are forcing it to immediately shut down its feeder airline CityLine earlier than planned and take its 27 older, less fuel efficient planes out of service. The decision accelerates a shutdown that had been expected for next year.

CityLine’s primary role was bringing passengers to Lufthansa’s mid- and long-haul hubs in Frankfurt and Munich, Germany. Fuel prices have soared since the outbreak of the Iran war in February and the blocking by Iran of the Strait of Hormuz, a key passage way for crude oil and fuel products from Persian Gulf producers.

CityLine will halt operations Saturday.

Houthi leader in Yemen blames the US in Iran talks

Abdul Malik al-Houthi, leader of the Iran-backed Yemeni rebel group, said that in negotiations with Iran, the U.S. is making “impossible demands for any independent country to accept.”

During a video speech Thursday, he said the ongoing two-week ceasefire was a result of “failures” by the U.S. and Israel to achieve their goals in the Iran war.

“If negotiations succeed, it will either result in a longer period of stability or an end to the aggression,” he said, adding that the U.S. entered negotiations based on their own terms built on “arrogance and pride.”

Death toll of Lebanese killed in Israeli strikes increases to 2,196

Lebanon’s Health Ministry says that among the killed are 260 women and 172 children since the latest war between Israel and Hezbollah began March 2. Another 7,185 have been wounded.

Israel’s latest military escalation started after Hezbollah fired rockets towards northern Israel in solidarity with its key ally and patron Iran.

Lebanon and Israel started direct talks Tuesday, the first of their kind since 1993. Lebanon hopes those talks can end the war.

Pakistan says second round of US-Iran talks not yet scheduled

“There are no dates yet,” Pakistan’s Foreign Ministry spokesperson Tahir Andrabi told reporters Thursday.

“We will announce the timing of these talks as and when it is decided,” he said, urging the media to avoid speculation.

Andrabi said Pakistan’s role as a mediator and facilitator did not end when the first round of talks concluded over the weekend.

“It continued,” he said.

He said Pakistan’s army chief, Field Marshal Asim Munir, is visiting Iran with a delegation, while Prime Minister Shehbaz Sharif is also traveling to regional countries to promote peace.

“We will continue to advocate for peace, prosperity and stability,” he said.

Asked about the first round of talks, Andrabi said there was “certainly not a major breakthrough in terms of any concrete document emanating from these talks, but there was no breakdown as well.”

‘Difficult days and weeks’ for sailors trapped on ships unable to travel through Strait of Hormuz

Germany’s largest shipping company Hapag-Lloyd says it’s feeling the impact of the blockade of the Strait of Hormuz as 150 sailors are trapped there on six of its vessels.

“Five and a half weeks in a war zone — that’s something relatively new. And of course, these are difficult days and weeks for our colleagues,” Hapag Lloyd spokesperson Nils Haupt told The Associated Press.

“We’ve been able to rotate some of them in the meantime, but you can easily imagine that after such a long time, monotony naturally sets in on board and the most important thing now in this situation is to maintain that team spirit,” he added.

Hapag-Lloyd is in contact with the captains and crews at least once a day asking how the crew is doing and what they can do to help.

It’s helpful, Haupt says, that thanks to modern satellite technology, the sailors are able to keep up communication with their families.

Pentagon urges Iran to make a deal

U.S. Defense Secretary Pete Hegseth told reporters at the Pentagon that “ultimately, they need to come to the table and make a deal.”

He said the U.S. will ensure Iran never has a nuclear weapon.

“We’d prefer to do it the nice way through a deal led by our great vice president and negotiating team. Or we can do it the hard way,” Hegseth said.

Iran has repeatedly insisted that it doesn’t seek a nuclear weapon and that its program is for peaceful purposes.

Later in the news briefing, Hegseth said to Iran’s government: “I pray you choose a deal, which is within your grasp for the betterment of your people and for the betterment of the world.”

Lebanese President Joseph Aoun has refused to speak to Israeli Prime Minister Benjamin Netanyahu

That’s according to a government official familiar with the developments.

The official, who spoke on condition of anonymity in line with regulations, said the remarks were made during a call with U.S. Secretary of State Marco Rubio and that Washington was “understanding of Lebanon’s position.”

Aoun’s office acknowledged a call with Rubio in a public statement, but did not mention the possibility of talks with Netanyahu. Netanyahu’s office did not do so either.

— Kareem Chehayeb

Israeli defense minister says Iran faces a stark choice

The minister, Israel Katz, warned Tehran it could opt “between a bridge to the future and an abyss of isolation and destruction.”

If Iran chooses the latter, it will “quickly discover that the targets we have not yet struck until now are even more painful than what we have already struck.”

Katz sought to frame Israel’s campaign against the militant group Hezbollah in Lebanon as part of a wider confrontation with Iran.

He was speaking at a memorial ceremony at the ministry Thursday.

Europe has ‘maybe six weeks’ of jet fuel left, energy agency head tells the AP

Europe has “maybe six weeks or so (of) jet fuel left,” the head of the International Energy Agency said Thursday in a wide-ranging Associated Press interview, warning of possible flight cancellations “soon” if oil supplies remain blocked by the Iran war.

IEA Executive Director Fatih Birol painted a sobering picture of the global repercussions of what he called “the largest energy crisis we have ever faced,” stemming from the pinch-off of oil, gas and other vital supplies through the Strait of Hormuz.

“In the past there was a group called ‘Dire Straits.’ It’s a dire strait now, and it is going to have major implications for the global economy. And the longer it goes, the worse it will be for the economic growth and inflation around the world,” he said.

The impact will be “higher petrol (gasoline) prices, higher gas prices, high electricity prices,” Birol told the AP, speaking in his Paris office looking out over the Eiffel Tower.

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Caine says the US will pursue Iranian ships broadly

Speaking at the Pentagon, he said U.S. forces “will actively pursue any Iranian flagged vessel or any vessel attempting to provide material support to Iran” — anywhere in the world.

He issued a clear warning to any targeted vessel attempting to circumvent a U.S. blockade: “Turn around or prepare to be boarded. … We will use force.”

Caine described the effort as a “blockade of Iran’s ports and coastline” with enforcement “inside Iran’s territorial seas and in international waters.” He noted that U.S. forces in other areas of the world, including the Pacific, also would pursue vessels tied to Iran.

The blockade “applies to all ships, regardless of nationality, heading into or from Iranian ports” and includes “dark fleet vessels carrying Iranian oil.” He defined those as “vessels or those illicit or illegal ships evading international regulations, sanctions or insurance requirements.”

Joint Chiefs chairman says no ships boarded yet under blockade of Iranian ports

Gen. Dan Caine says more than 10,000 sailors, marines and airmen using ships, planes and helicopters are working to enforce the blockade.

Any vessel that approaches the blockade is first warned to turn around or be boarded. Warning shots and other escalatory tactics could also be used, Caine said.

Caine says that so far no ships have had to be boarded.

“Thirteen ships have made the wise choice of turning around,” he said.

Joint Chiefs chairman likens Iran blockade to supermarket parking lot

President Trump’s top military advisor described Navy warships maintaining the blockade against Iran “like driving a sports car through a supermarket parking lot on a pay day weekend.”

Gen. Dan Kaine, the Chairman of the Joint Chiefs of Staff, went on to say these maneuvers are being performed “with thousands of kids in that parking lot” as they position themselves to get to ships that would attempt to run that blockade.

Hegseth says Americans ‘see the success’ in Iran, but polling reflects concern

The defense secretary touted public support for the war during remarks at the Pentagon on Thursday, contrasting that with what he said was an overly critical press.

“They see the success. They see the reality. And they don’t demand perfection,” Hegseth said of the public, after criticizing the press.

“You only seek the negative,” Hegseth said of the press.

Hegseth is overstating public support for the conflict. A recent AP-NORC poll shows nearly 60% of Americans say U.S. military action in Iran has been excessive. Meanwhile, 45% are “extremely” or “very” concerned about being able to afford gas in the next few months.

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The global energy shock stemming from the conflict in the Middle East is rewriting the ways governments think about their power needs. Big Oil has predictably emerged as an early winner, benefiting from soaring oil and gas prices, but the long-term upshot could be faster dispersal of an altogether different energy source.

Despite negotiation attempts during the current ceasefire, officials from theTrump administration and Iran remain at an impasse over the Strait of Hormuz, meaning most of the Middle East’s oil and gas is still locked up in the Persian Gulf seven weeks since the start of the war.

That hole in global energy supply has sent countries scrambling for alternatives for their fuel and electricity needs, including for coal, potentially marking a resurgence for the dirtiest fossil fuel that was quickly being phased out around the world. Asian countries, formerly the Middle East’s biggest energy customers, have indeed delayed plans to close down coal-fired power plants and ramped up output from existing ones. 

But while coal demand has risen since the Strait of Hormuz locked down, the data tells an altogether different story about what direction the global energy mix is headed. Global fossil fuel power generation fell in the first month of the war, according to an analysis published Tuesday by the Centre for Research on Energy and Clean Air (CREA), a think tank. That was mostly because of the hole in global natural gas supply, as gas-powered generation fell 4% in March year-on-year. 

But in most cases, countries are shunning coal and filling the gap by turning to renewable energy sources instead. Coal usage remained more or less flat compared to March of last year, and by excluding China—which alone accounts for more than half of global coal consumption—coal-fired power generation actually declined 3.5%. Renewables data for China was not included in CREA’s dataset, but in the rest of the world, solar power usage rose 14% in March, with wind power generation up 8%.

“The government statements used to create a ‘back to coal’ narrative range from meaningless to inconsequential,” wrote Lauri Myllyvirta, CREA’s cofounder and lead analyst. “There has been no increase in coal capacity so far.”

Coal remains a hard sell

To be sure, coal demand has risen over the past month and a half. The fuel often becomes a “critical fallback” during energy supply shocks, Sushmita Vazirani, an analyst at energy consultancy Wood Mackenzie, wrote in a report published this week. India, as well as several countries in East Asia and Europe, have ramped up their coal-fired power generation plans in the near term, she wrote, to compensate for soaring liquified natural gas prices.

But an uptick in interest for coal doesn’t mean it will figure permanently into countries’ energy plans, CREA’s report argued. Around the world, most coal plants were already running at or near full capacity, meaning commitments to ramp up production will lead to relatively small increases on aggregate. Another reason is that the longer the energy crunch goes on, the more expensive coal will get. Wood Mackenzie estimated that for every $10 per barrel rise in crude oil prices, coal per tonne gets $1 to $3 pricier too. That is because soaring diesel prices raise the cost of mining and transport that is needed to get coal to buyers.

But the biggest indicator that the global coal scramble might prove short-lived is how comparatively cheap clean energy alternatives like wind and solar have become. A report by the International Renewable Energy Agency (IRENA) published last year found that 91% of new renewable energy projects are more cost-effective than fossil fuel options.

Even countries that have increased coal production since the war started have hedged their bets. In South Korea, for instance, where a coal plant had been slated to shutter in June, the closure has been postponed by only nine months (and two more were under review). Meanwhile, its President Lee Jae Myung urged the country to “move very quickly toward renewable energy” during a speech last month, adding: “Our future will be at serious risk if we continue to rely on fossil fuels.”

There’s another market signal suggesting countries have looked to insulate themselves from fossil fuel shocks since the war began. Across southeast Asia in particular, but also in East Asia and Australia, demand for electric vehicles has surged over the past month as fuel concerns start to bite at consumers.

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Higher education is mired in a PR crisis. Since the start of his second term, President Donald Trump has targeted the nation’s most elite institutions, including the Ivy League. The cracks first appeared during campus protests over the war in Gaza, throwing the leadership lapses and internal tensions of colleges and universities into clear view.

Last year, Yale University President Maurie McInnis asked a group of faculty to find out why the university has grown so unpopular in the public’s eye. Their 20 recommendations match what many critics have echoed for years, suggesting everything from tamping down on grade inflation to opaque admissions standards.

“Our committee’s work brought us face to face with some of higher education’s greatest challenges and blind spots,” the report reads.

A recent Gallup poll found public trust in higher education fell to just 36% in 2023 and 2024, a low among a series of controversies facing the institutions. While that number was back up to 42% in 2025, it remains near historical lows. But the pressure extends beyond reputational issues. People today are questioning the value proposition of the four-year degree as AI threatens to automate many white-collar roles across industries spanning law, business, engineering, and computer science. 

‘Grade like we mean it’

Among the 20 recommendations, which span everything from protecting free speech, supporting “open minds,” and tamping down on devices in classrooms, the committee called on university faculty to “grade like we mean it.” Grade inflation took to the national spotlight after Trump pushed a crackdown on the practice, tying federal funding to whether universities modify grading practices.

And Yale is guilty of the practice. A 2023 report  from Yale economics professor Ray Fair found that Yale dished out A or A- grades to a staggering 79% of students, meaning the median student at Yale receives an A. That’s up by nearly 60 percentage points from 1963, when the school gave out the same grades to just 10% of the student body. Harvard also admitted it was giving out too many As last year.

“Decades of inflation and compression have rendered the college grading system almost meaningless as an academic measure,” the report reads.

Grade inflation isn’t just injurious to a university’s reputation. The students receiving those straight A’s could also find themselves losing out in the long run. A recent study from National Bureau of Economic Research (NBER) entitled “Easy A’s, Less Pay: The Long-Term Effects of Grade Inflation,” found grade inflation has a direct link to poorer long-term salaries.

“Average grade inflation hurts,” Nolan Pope, one of the study’s researchers and a labor economist at University of Maryland, told Fortune in a recent interview. “They are less likely to learn if it’s very easy to get an A. They spend less time and effort.”

The committee recommended a 3.0 mean grade, or a similar class-wide average, as well as devising a percentile ranking, to mitigate grade inflation on campus. 

Reforming undergraduate admissions

The report also found certain undergraduate admissions practices appeared unfair to the public, specifically the preferential treatment of certain applicants, including legacies, varsity athletes, and children of faculty, staff, and donors.

“The current system of preferences for certain groups of applicants,” the report reads, “distorts the admissions process by reducing the number of slots available to high-achieving applicants who do not fit into one of the favored categories.”

A 2025 NBER study found college admissions favor rich kids. Children from families in the top 1%, for example, were nearly 60% more  likely to be admitted into an elite university as compared to middle-class applicants. That’s because higher-income applicants tend to have access to the resources needed to catch an admission officer’s attention, including SAT tutors that can help boost their score. There’s a near-million dollar market for that. Some rich families are paying admissions specialists $750,000 to get their kids into the Ivy league. 

Undergraduate admissions practices have been upended in recent years. In 2023, the Supreme Court ruled affirmative action unconstitutional, shifting admissions decisions away from considering race. Around the same time, the Biden administration sought to end preferential treatment for the children of alumni and donors.

The committee’s recommendation? Go back to the basics: give a floor for academic achievement, such as a minimum SAT score, shedding other tangential qualifications.

“It should only use criteria for admission that it is willing to describe publicly and defend openly,” the report reads.

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The confrontation was inevitable. When White House budget director Russell Vought appeared before the House Budget Committee on Wednesday to defend President Trump’s fiscal year 2027 budget, the hearing erupted almost immediately—with protesters ejected from the chamber before Vought could finish his opening statement, and Democratic lawmakers waiting their turn to unload.

The budget at the center of it all proposes $1.5 trillion in total defense spending—a roughly 44% increase over current levels—while cutting non-defense discretionary programs by 10% across the board. In dollar terms, that means a roughly $442 billion increase for the Pentagon, funded in part by reductions to Medicaid, housing assistance, child care, and home energy aid for low-income seniors—a trade-off that Democrats called a moral obscenity and Republicans called overdue.

“The budget builds upon the historic $1 trillion fiscal year 2026 defense topline by requesting $1.5 trillion for 2027, a 42% increase, as promised by President Trump last year,” Vought told the committee. “The 2027 budget will ensure that the United States continues to maintain the world’s most powerful and capable military as we grapple with an increasingly dangerous world.”

The backdrop to Vought’s testimony was a comment Trump made weeks earlier at a private White House Easter lunch, in which he said: “We’re fighting wars. We can’t take care of day care.” Trump went further, lumping in Medicaid and Medicare as things that should be pushed to states, which he said should raise their own taxes to cover the costs.

Pressed on those remarks by Rep. Brendan Boyle (D-PA), the committee’s ranking member, Vought pushed back—awkwardly. “No,” Vought said when asked if the administration had taken any steps to turn Medicare over to the states.

“The president doesn’t want to do that,” he continued.

When Boyle noted Trump had not mentioned fraud in his Easter remarks—and that the comments plainly included Medicaid, Medicare, and child care as programs the federal government simply shouldn’t fund—Vought sidestepped, saying Trump was “talking about fraud” in those programs.

The exchange over child care grew sharper when Rep. Becca Balint (D-VT) asked Vought whether $350 billion for the ongoing U.S.-Iran war helped reduce costs for Americans. Vought replied child care is “fully funded” in this budget. Rep. Morgan McGarvey (D-KY) later challenged that claim directly, holding up page 164 of the budget document and citing a provision he said slashed the fruit and vegetable benefit for breastfeeding mothers under the WIC nutrition program from $52 to $13 a month. Vought again replied: “We fully fund the WIC program.” McGarvey cut him off: “No, you don’t. It’s right here.”

The macro numbers looming over the debate were stark. The national debt already stands near $39 trillion, and the Congressional Budget Office has said the administration’s One Big Beautiful Bill—enacted last year—adds more to the deficit than any single piece of legislation in American history, stripping health care coverage from as many as 15 million to 17 million Americans, according to CBO and the Kaiser Family Foundation. Boyle asked Vought if he could seriously maintain, with a straight face, that all of those people were either in the country illegally or defrauding the system. “I didn’t say all of them are illegal,” Vought replied, adding, there’s “also the benefit of people returning to the workforce.”

The committee also heard from Rep. Pramila Jayapal (D-WA), who noted the Department of Defense has now failed eight consecutive audits and remains the only federal agency that has never passed one—even as Vought requests a historic budget increase for the Pentagon.

“You want to talk to me about fraud?” Jayapal asked. “There is over $10 billion in confirmed fraud within the Department of Defense, but you’re not going after any of that.”

Meanwhile, energy prices rose nearly 11% last month according to the Department of Labor’s own data—gas up more than 21%, home energy up more than 30%—a backdrop that made the budget’s elimination of the Low Income Home Energy Assistance Program especially pointed. Consumer confidence has plunged to its lowest level ever in the long-running University of Michigan survey, dating back 74 years, hitting 47.6 in preliminary April readings, a 10.7% drop from March.

Vought closed his opening remarks with a signature phrase, saying it’s “the end of fiscal futility.” Whether Congress agrees—and whether it can pass a budget before the fiscal year deadline—remains an entirely open question.

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.

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Pope Leo XIV blasted the “handful of tyrants” who are ravaging Earth with war and exploitation, as he preached a message of peace Thursday in the epicenter of a separatist conflict considered one of the world’s most neglected crises.

Leo traveled to the western Cameroon city of Bamenda, where jubilant crowds clogged the roads, blowing horns and dancing. They were overjoyed that a pope had come so far to see them and put a global spotlight on the violence that has traumatized this region for nearly a decade.

Leo presided over a peace meeting involving a Mankon traditional chief, a Presbyterian moderator, an imam and a Catholic nun. The aim was to highlight the interfaith movement that has been seeking to end the conflict and care for its many victims.

In his remarks in the St. Joseph Cathedral, on land donated by the Mankon, Leo praised the peace movement and warned against allowing religion to enter conflicts. It’s a theme he has been echoing amid the U.S.-Israeli war in Iran and the religious justifications for it by U.S. officials.

“Blessed are the peacemakers!” he said. “But woe to those who manipulate religion and the very name of God for their own military, economic and political gain, dragging that which is sacred into darkness and filth.”

He called for a “decisive change of course” that leads away from conflict and the exploitation of the land and its people for military or economic gain.

“The world is being ravaged by a handful of tyrants, yet it is held together by a multitude of supportive brothers and sisters!”

It wasn’t immediately clear if any of the separatist fighters, who announced a three-day pause in fighting to allow the pope safe passage, attended.

The pope was to celebrate a Mass for the people of Bamenda, located near Cameroon’s western border with Nigeria, before returning to the capital Yaounde.

A conflict rooted in colonial history

The conflict in Cameroon’s two Anglophone regions is rooted in Cameroon’s colonial history, when the country was divided between France and Britain after World War I. English-speaking regions later joined French Cameroon in a 1961 U.N.-backed vote, but separatists say they have since been politically and economically marginalized.

In 2017, English-speaking separatists launched a rebellion with the stated goal of breaking away from the French-speaking majority and establishing an independent state. The conflict has killed more than 6,000 people and displaced over 600,000 others, according to the International Crisis Group.

Leo arrived to a raucous welcome in Bamenda, where blasting music from loudspeakers gave the event a concert-like vibe.

“We are so overjoyed, so overwhelmed,” said Felicity Cali, a Catholic student. “Say thank you, God, for this extraordinary day and for making us be alive to see this day.”

The separatist movement is believed to be backed by several actors abroad. In December, a federal jury in U.S. convicted two individuals for conspiracy to provide funds and equipment to the separatist fighters. Belgian authorities in March also announced they had arrested four people as part of investigations into Belgian residents suspected of being among the separatist leaders and raising money for them there.

“Those who rob your land of its resources generally invest much of the profit in weapons, thus perpetuating an endless cycle of destabilization and death,” Leo said. “It is a world turned upside down, an exploitation of God’s creation that must be denounced and rejected by every honest conscience.”

Cameroon sits atop significant reserves of oil, natural gas, cobalt, bauxite, iron ore, gold and diamonds, making resource extraction one of the pillars of its economy.

While French and English companies have long dominated the extraction industry in Cameroon, Chinese companies have established a significant presence in recent years, particularly in the gold mining regions of the east.

On the eve of Leo’s arrival, separatist fighters announced a three-day pause in fighting. A spokesperson for the Unity Alliance, Lucas Asu, said the pause “reflects a deliberate commitment to responsibility, restraint and respect for human dignity, even in the context of ongoing conflict.”

Though the number of deadly attacks by separatists has decreased in recent years, the conflict shows no sign of resolution. Peace talks with international mediators have stalled, with both sides accusing each other of acting in bad faith.

Morine Ngum, a mother of three whose husband was shot dead in 2022 by Cameroonian soldiers while fighting as a separatist, expressed doubt that the pope’s visit and peace meeting would lead to meaningful change. She said any real progress must begin with those in power.

“Nothing is going to change,” said Ngum, 30. “This conflict has turned my children into orphans and me into a widow. Many families have been rendered homeless.”

Testimony to pope about the toll of the conflict

The archbishop of Bamenda, Andrew Nkea Fuanya, told Leo that the people there had suffered from “a situation they did not create,” losing their livelihoods, homes and education: Children were not allowed to go to school for years.

“Most Holy Father, today that your feet are standing on the soil of Bamenda that has drunk the blood of many of our children,” he said.

Leo, the former Cardinal Robert Prevost, spent two weeks sitting with Fuanya at the same table during Pope Francis’ 2024 big meeting, or synod, on the family.

The Right Rev. Fonki Samuel Forba, emeritus moderator of the Presbyterian church in Cameroon, said the Vatican had joined other faith groups in trying to bring the separatists to the negotiating table with the government, and meeting with their supporters abroad.

Biya’s government has been accused of shunning dialogue with the separatists. The last time a peace meeting was held between the government and separatists was in 2022 during talks facilitated in Canada by the Canadian government.

“There is a proverb in Africa that ‘When two elephants fight, it is the grass that suffers,’” Forba said.

___

Akua contributed from Yaounde, Cameroon. Associated Press writer Chinedu Asadu in Abuja, Nigeria, contributed to this report.

___

Associated Press religion coverage receives support through the AP’s collaboration with The Conversation US, with funding from Lilly Endowment Inc. The AP is solely responsible for this content.

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For months, New York Gov. Kathy Hochul has resisted calls to increase taxes on the wealthy, beating back progressives who have hounded her from Manhattan to Puerto Rico bellowing chants of “tax the rich.”

Now she is pitching a compromise.

The moderate Democrat says she will push to create a new tax on multimillion-dollar second homes in New York City known as pied-à-terres, attempting to appease Mayor Zohran Mamdani and his supporters while also tending to her concerns about destabilizing the state’s finances.

The idea, announced Wednesday, would allow the city to impose a tax surcharge on secondary residences worth over $5 million, with the governor’s office saying it could generate at least $500 million annually as Mamdani moves to fill a multibillion dollar budget hole and fund his ambitious agenda.

“As Governor, I understand the importance of stabilizing the city’s finances without compromising on essential services New Yorkers count on,” Hochul said in a statement. “If you can afford a $5 million second home that sits empty most of the year, you can afford to contribute like every other New Yorker.”

The governor’s office said she would include the measure in this year’s state budget, a sprawling bundle of bills that are still being hotly negotiated in Albany after the governor and Legislature blew past an April 1 due date for the spending plan.

Mamdani, who has called for a much broader tax increase on the rich, cast the proposal as a win, saying in a statement that it places him “one step closer to balancing our budget by taxing the ultra-wealthy and global elites.”

At an unrelated forum focused on taxes, Mamdani, appearing in front of a large banner that read “Tax The Rich,” said the proposal would target the “super wealthy who can purchase properties and use them to store their wealth to benefit from New York City’s real estate market but not have to pay back into that same city.”

Hochul has long rejected increasing personal income or corporate taxes, arguing that such measures would further incentivize residents and big businesses to flee the city for states with lower tax rates, thereby eroding the state’s tax base.

Still, the calls have followed her, with progressives chanting “tax the rich” when she appears at events, and even when she was at an annual political conference in San Juan late last year.

The governor is also contending with a possible political vulnerability over raising taxes as she runs for a second full term in office and tries to fend off Republican criticisms over high taxes in the state.

Her Republican challenger this fall, Bruce Blakeman, wasted little time in turning the proposal into a familiar attack.

“Kathy Hochul’s ‘No Tax Hike’ promise has expired faster than the families fleeing New York’s affordability crisis,” said Blakeman, a county executive in the city’s suburbs. “Unlike Hochul, I’ll actually keep my word when I’m governor: I’ll cut your taxes, slash your utility bills in half, and protect the American Dream.”

Mamdani, a Democrat, has urged the governor and state Legislature to raise taxes on the rich, calling for wealthy residents to pitch in more money for programs intended to help the city’s struggling working-class.

At the same time, he also finds himself confronting a massive budget gap — which he first put at around $12 billion but later revised to about $5 billion after savings and financial assistance from the state — that could imperil his agenda and city services more widely.

At a news conference, Hochul said the proposal will help the city close its budget gap without having to cut services, but said the mayor and City Council must find additional savings as they move to balance their budget.

“Our goal is to get the city on stable ground, to close the gap so we can take the pressure off,” she said.

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Stress comes with the territory of being at the helm of billion-dollar corporations—so CEOs are turning to personal rituals and deliberate routines to stay sharp and avoid burnout. Ivan Espinosa, the CEO of Japanese the $8.5 billion car giant Nissan, decompresses from the job by jamming out with his band and hitting the tennis courts each weekend. 

“How do I manage stress? Well, I try to continue being myself,” Espinosa said in a recent interview with The Wall Street Journal. “So I like to play tennis on the weekends. If I can’t, I play golf. And I also am a musician.”

The Mexican national first joined Nissan back in 2003 as a product specialist in the company’s Mexico planning division; after rising through the ranks and serving senior positions in Thailand and Europe, Espinosa finally moved to Nissan’s global headquarters in Japan in 2016. He also held a litany of leadership roles before assuming the role of CEO last April. 

Throughout a whirlwind career like Espinosa’s—bouncing around different companies, and taking on greater responsibilities—stress is bound to creep in. However, reconnecting to himself through music and exercise has kept his cortisol down. 

“I like to play the drums. So I have a band, every now and then we get together and we play for a while,” the Nissan leader continued. “This helps me staying [sic] real and staying [sic] true to myself.”

How leaders manage stress: meditation and runs on the beach

CEOs are falling into their own rhythms to manage the pressure from their high-profile, stressful positions in the business world. 

Michael Tennant, the founder of purpose-driven venture studio CEO of Curiosity Lab, has perfected a formula to combat stress. Right after waking up, the leader freshens up, meditates, journals, and zeroes in on the most critical task of the day. He front-loads his days with work that is creative and inspires him, then slides into difficult and intense leadership tasks. 

“My morning routine is the biggest part of my stress management,” Tennant told Fortune in 2023. “This routine gives me the space to assess everything in my world, set daily priorities, and take action toward achieving them that day.”

Adam Ross, the former CEO and co-founder of skincare services business Heyday, fends off stress in the same “cathartic” way as Espinosa: exercise. And it’s a popular choice among business leaders; Four Seasons Hotels and Resorts CEO Alejandro Reynal makes fitness a priority in leading the billion-dollar luxury hotel chain. He jump-starts his day with an early morning workout, and combats burnout by taking time to find calm before the office grind. 

“Routine helps me stay grounded: I start my mornings early, exercise or run on the beach, have breakfast with my family, and take a few quiet moments before the day begins,” Reynal told Harvard Business Review last year. “Most stress fades when you reconnect with purpose—and remember that what we do is about people, not pressure.”

Meanwhile, Amazon founder Jeff Bezos handles his stress in a completely different way. The entrepreneur worth $268 billion wards off stress by confronting his anxieties head-on—whether it requires sending an email, or picking up the phone to smooth things out. 

“Stress primarily comes from not taking action over something that you can have some control over,” Bezos told the Academy of Achievement in 2001. “I find as soon as I identify it, and make the first phone call, or send off the first e-mail message, or whatever it is that we’re going to do to start to address that situation—even if it’s not solved—the mere fact that we’re addressing it dramatically reduces any stress that might come from it.”

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China’s economy accelerated in the first quarter of this year, expanding 5% from a year earlier as it largely shrugged off impacts from the Iran war so far, according to data released Thursday.

The January-March data released by the government, covering a period during which the Iran war began, was better than what economists expected and was up from the 4.5% growth seen in the October-December quarter.

On a quarter-on-quarter basis, China’s economy grew 1.3% in the first three months from the final quarter of last year, the fastest pace in a year.

Economists expect China, the world’s second largest economy, to be able to weather short-term impacts from the Iran war, now in its seventh week. The war is pushing energy prices higher, worsening inflation and impacting global economic growth. But longer term, areas including global demand for Chinese exports could take a hit.

The International Monetary Fund this week trimmed its economic growth estimates for China to a 4.4% expansion for 2026 as it lowered its global growth forecasts over Iran war shocks. Chinese leaders last month set an economic growth target of 4.5% to 5% for this year, the slowest since 1991.

“China can likely weather short term disruptions, but a protracted war and higher for longer energy prices would likely start to bite into growth by the second half of the year,” said Lynn Song, chief economist for Greater China at Dutch bank ING.

Also on Thursday, government data showed industrial output in China rose 5.7% in March year-on-year, better than market expectations, as global demand for Chinese exports of electronic equipments, autos, semiconductors and robotics remained strong.

Retail sales were up 1.7% from a year earlier, worse-than-estimates and slower than the 2.8% growth in January and February, reflecting sluggish domestic demand for consumer goods.

A years-long real estate sector slump in China has dragged consumer and investor confidence, but the country managed to achieve its targeted “around 5%” growth last year, powered by robust exports that drove its trade surplus to a record nearly $1.2 trillion despite U.S. President Donald Trump’s higher tariffs.

China’s exports will continue to be key in propelling its economy this year, economists believe, but reliance on export growth could now increasingly become a problem.

“The lack of a speedy resolution to the Iran war is likely to dent global growth, which will negatively impact other economies’ ability to absorb Chinese exports,” said Eswar Prasad, a professor of economics and trade policy at Cornell University.

“At a time when all countries are trying to protect their firms, households and economies from the fallout of the Iran war, the appetite for Chinese imports is clearly shrinking,” he explained.

On Tuesday, China reported its exports grew 2.5% in March from a year ago, significantly slowing from the previous two months although some analysts partly attributed that to seasonal distortions.

China could likely still attain its full year economic growth target of 4.5% to 5% for 2026 through policy stimulus measures, economists say, but there are other concerns.

A boost in public sector investment, Prasad said, would stabilize headline growth but, unless household demand strengthens significantly, could intensify underlying deflationary pressures and increase the economy’s reliance on exports down the line.

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The BBC said Wednesday that it plans to cut up to 2,000 jobs to save 10% of its annual budget — 500 million pounds ($677 million) — over the next two years.

The layoffs announced during a call with staff are the biggest in more than a decade at the U.K. national broadcaster.

“I know this creates real uncertainty, but we wanted to be open about the challenge,” interim Director-General Rhodri Talfan Davies said in a staff email.

Davies said that the reductions were driven by inflation, pressures to license fee and commercial income and a turbulent global economy.

The BBC said earlier this year that it faced “substantial financial pressures” and wanted to cut about a tenth of its budget by 2029. The bulk of the cuts are to be made in the next fiscal year beginning April 1, 2027.

The cuts come as former Google executive Matt Brittin is scheduled to take over as director-general next month.

He will fill the vacancy left after Tim Davie, and head of news Deborah Turness resigned over a misleading edit in a documentary about U.S. President Donald Trump’s speech on Jan. 6, 2021, before his followers stormed the U.S. Capitol.

Trump is suing the BBC for $10 billion for defamation.

The BBC is both a beloved and oft-criticized cultural institution funded by an annual license fee, which recently rose to 180 pounds ($244), paid by all U.K. households who watch live television or any BBC content.

Opponents of the fee, including rival commercial broadcasters, have grown louder in an era of digital streaming, when many people no longer have television sets or follow traditional television schedules.

The center-left Labour government has vowed to ensure that the BBC has “sustainable and fair” funding, but hasn’t ruled out replacing the license fee with another funding model.

The BBC was founded in 1922 as a radio service to “inform, educate and entertain.” It now operates 15 U.K. national and regional television channels, several international channels, 10 national radio stations, dozens of local radio stations, the globe-spanning World Service radio and extensive digital output, including the iPlayer streaming service.

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Good morning. Bank of America posted its strongest earnings in nearly two decades, and CFO Alastair Borthwick says AI is becoming key to the bank’s performance.

The bank reported on Wednesday that Q1 2026 net income was $8.6 billion, with earnings per share up 25% to $1.11, which is the highest level in almost 20 years. On a media call, Borthwick pointed to AI as an increasingly important driver, highlighting a new internal tool for financial advisors.

The Meeting Journey tool helps advisors prepare for client meetings by pulling together key information. BofA has about 18,000 financial advisors across its wealth management platform, serving millions of clients, he said. Before meeting with a client, advisors regularly need to update themselves with a wide range of information such as client history, recent activity, and CIO guidance, he explained. 

The tool searches and consolidates client relationship insights and recent activity into ready-to-use prep materials and, with client consent, acts as an AI notetaker during virtual meetings. It also summarizes meeting decisions and next steps based on those notes. The goal is to cut down hours of manual prep and free advisors to focus on client relationships.

“Efforts like this translate into results,” Borthwick said, pointing to record first-quarter revenue and improved cost control. 

Preparing for meetings once meant pulling data from multiple systems; now much of that work is automated, he said. “Not necessarily the judgment—that can be human,” Borthwick added. The bank invests around $13.5 billion annually in technology, including approximately $4 billion on new initiatives like AI.

More broadly, BofA’s strong quarter was driven by several factors:
—Net interest income rose 9% to $15.9 billion as loan and deposit growth accelerated.
—Trading revenue hit $6.3 billion—its best in roughly 15 years—boosted by a record high 30% jump in equities.
—Investment banking fees climbed 21% to $1.8 billion on a solid M&A market.
—Asset management fees grew 15% to $4.2 billion.
—Productivity gains, including from AI, helped the company maintain cost discipline and improve its efficiency ratio by 170 basis points to 61%. 

With revenues outpacing expenses, BofA achieved its third consecutive quarter of operating leverage at 2.9%. This week, Morningstar raised its fair value estimate for BofA to $65 per share, up from $58.

Amid ongoing uncertainty around geopolitics, rates, and credit, Borthwick said the bank’s data shows a resilient U.S. consumer. Unemployment remains at around 4.3%, supporting spending, while a recent rise in gas outlays hasn’t materially changed the broader picture, he said. “You can see that in our asset quality,” he added.

Sheryl Estrada
sheryl.estrada@fortune.com

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The resistance is measurable, the anxiety is real—and neither will slow down what’s coming.

A new global survey of 3,750 executives and employees across 14 countries finds more than 54% of workers bypassed their company’s AI tools in the past 30 days and completed the work manually instead. Another 33% haven’t used AI at all. Combined, roughly eight in 10 enterprise workers are either avoiding or actively rejecting the technology their employers are spending record sums to deploy. And yet, 50% of Americans told Plaid researchers this week managing money without AI will soon feel outdated—and 52% already expect their fintech apps to use it.

Both numbers come from the same moment in time.

That is the paradox of the AI moment in 2026: The backlash and the inevitability are not competing stories. They are the same story, told from different points on the adoption curve.

By the numbers

• 80% of enterprise workers are avoiding or rejecting AI tools (WalkMe)
• 56% of U.S. adults have no recent AI experience (ACSI)
• 86% of Americans who use AI for finances say it helps them better understand money (Plaid/Harris)
• 43% of Americans say loss of human interaction is their top AI concern (ACSI)
• 50% say managing money without AI will soon feel outdated (Plaid/Harris)
• 73 — AI’s average ACSI customer satisfaction score, on par with energy utilities

‘It tastes like a Twinkie’

Veteran tech journalist Kara Swisher thinks the resistance is more durable than the hype suggests. On a recent episode of her podcast On With Kara Swisher, she argued AI may be hitting a ceiling—not because of technical limits, but because of human ones. “Human beings don’t like it,” she said flatly. “Ultimately, AI feels like a Twinkie. It tastes like a Twinkie. And I don’t know if they can ever make it taste like an apple.”

The numbers back her up, at least partially.

A Walton Family Foundation survey found nearly one-third of Gen Z says the tech makes them angry. The American Customer Satisfaction Index puts overall AI platform satisfaction at 73 out of 100—below airlines, social media, and mortgage lenders.

“Consumers spent the last decade learning to distrust how social media platforms handle their data, and AI’s privacy scores suggest they’re carrying that skepticism forward,” said Forrest Morgeson of Michigan State University and the ACSI. “The window to get ahead of that trust deficit is right now.”

Why Gen Z is the most conflicted generation

The generational data doesn’t resolve cleanly. Gen Z posts the lowest AI satisfaction score of any generation—69 on the ACSI scale—while simultaneously being the cohort most likely to say AI will open financial doors they don’t have today. Sixty-two percent of Gen Z and Millennials told Plaid’s Harris Poll researchers AI will unlock financial opportunities they don’t currently possess, and 54% say AI can predict their financial habits better than they can. They are souring on AI culturally while leaning on it financially—a split that says less about the technology than about how, and by whom, it’s being deployed.

In finance, the trust gap is the product gap

Nowhere is the stakes gap clearer than in financial services, where 43% of Americans name reduced human interaction as their top AI worry—ahead of job loss.

Three-quarters say it’s important to know when AI is being used in financial decisions, and 80% believe companies should reimburse them for AI-driven mistakes. The demand isn’t for less AI. It’s for AI that explains itself.

“Sixty percent of consumers say they would trust the technology more if they understood the ‘why’ behind its logic,” the Plaid report found. Trust here isn’t a soft metric—it’s the product decision that determines whether consumers engage at all.

The symmetry of winners and losers

The WalkMe data contains a number that should unsettle every executive defending a slow rollout: Workers lose the equivalent of 51 working days per year to technology friction. Goldman Sachs economists found AI saves workers who use it correctly an average of 40 to 60 minutes per day. The math is nearly symmetrical—the productivity AI gives to people who use it well is almost exactly equal to the productivity it destroys for people who can’t get it to work.

Among the 44% of Americans who have crossed the adoption threshold, 52% now use AI at least once a day. Among AI users who apply it to their finances, 86% say it helps them understand their money better. The gap between those people and the 80% still holding out isn’t philosophical. It’s compounding.

“A workforce that’s not leaning into AI is going to be challenged,” KPMG’s Brad Brown told Fortune. “And a work environment that is overly oriented to AI without the value of the human workforce is going to struggle.”

The workers and companies navigating that balance now aren’t just managing a transition. They’re setting the standard that everyone else will eventually have to meet—whether they’re ready or not.

For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.

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As a small business owner in Columbia, Pa., I have always paid my taxes on time each and every year. My family started Susquehanna Glass in 1910 when my grandfather installed a cutting machine in a shed behind his house. I joined the business in 1975 and spent five dcades growing it into a company that serves customers across the country.

Three generations built something worth protecting. Then, an unexpected ransomware attack shut down our business one morning.

It was the first Tuesday in December, during our busiest season. We came in at nine o’clock and strange messages began popping up on screens across the building. An overseas group of criminals had found its way into our server and encrypted everything: financials, inventory, customer records, employee files with Social Security numbers and bank information. The software that runs our company froze. The machinery in the shop stopped. We shut down the factory and sent 40 employees home while I scrambled to wrest back control from criminals demanding a fortune.

The criminals demanded a million dollars to give me my own business back.

We were lucky in the strangest sense of the word. We had cyber insurance and backup hard drives the hackers deleted but did not encrypt. We overnighted those drives to a recovery company in California, and by Friday they had recovered virtually everything.

But while we never paid a dime of ransom, the cleanup still cost over $100,000: attorneys, forensic investigators, data recovery, and IT. While being a responsible, tax-paying citizen, these costs resulting from the ransomware attack essentially became a new, unsolicited tax — something I won’t forget as we pay our annual taxes this year.

We offered identity theft protection to every employee whose information was exposed and ran overtime to fulfill Christmas orders guaranteed for holiday delivery. If the recovery had not come through, my 116-year-old business would have closed forever.

My experience is not unusual. It is the norm for American small business owners. A national survey commissioned by the Public Private Strategies Institute found that nearly three in four small businesses (72%) were hit by fraud, scams, or ransomware last year. Average losses were nearly $60,000 for payment fraud and more than $90,000 for email compromise. Across small businesses in the US, the toll reached $131 billion last year.

This is a hidden tax on Main Street that no one voted for. As Tax Day arrives, millions of owners are calculating what they owe the government. What they will not see on any form is the other tax they paid last year, collected not by the IRS but by criminals. This theft is a loss for the entire economy. That $131 billion could have funded new hires, new equipment, and new locations. Instead, it went to scammers who impersonate vendors, hijack email accounts, and hold data for ransom.

Fraud does not merely drain revenue, it slows growth. Forty-three percent of affected businesses say fraud makes it harder to accept payments. Forty percent say it undermines their ability to attract customers. Thirty-nine percent say it interferes with developing new products. These are jobs not created, customers not served, communities that don’t reap the benefits of expanding local business.

The threat is accelerating. Seven in ten small business owners believe AI will make attacks more frequent. Among businesses already targeted, 76 percent say AI was used against them. The next generation of attacks will be worse.

Yet preparedness lags awareness. Fewer than half of small business owners feel ready for the most common attacks, and the tools that work best are the least widely adopted. Multifactor authentication is used by just 48% of businesses, though 70% of users call it very effective. Cyber insurance covers only 24%, though 61% of policyholders call it effective.

Fraud is getting more attention from policymakers, and protections are beginning to take shape. That momentum must include protections for small businesses. The 33 million firms that employ nearly half the American workforce cannot be an afterthought when fraud prevention policies are written. And federal enforcement resources should match the scale of a $131 billion problem.”

In the meantime, here is what I would tell every business owner reading this: do not think you are too small to be a target. Get a good IT partner who talks to you, not just to your servers and buy the cyber insurance. Ours costs about $3,000 a year. The attack cost over $100,000, and that was the lucky outcome.

Tax Day is a useful reminder that small businesses already pay their share. They should not have to pay the criminals, too.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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By 8:15 a.m. Eastern Time today, oil had reached $97.06 per barrel, measured using the Brent benchmark. That’s 23 cents more than it cost yesterday morning and about $31 above its price a year earlier.

Will oil prices go up?

Oil prices are inherently unpredictable. While many variables come into play, the basic push and pull of supply and demand is what ultimately matters. In times of heightened concern about recession, war, or other major disruptions, oil can swing suddenly.

How oil prices translate to gas pump prices

Each gallon you pay for at the pump bundles together several costs. Crude oil is one piece, but you also pay for refineries, wholesalers, government taxes, and the price markup set by gas stations.

Because crude oil usually accounts for more than half of the price per gallon, it tends to move the needle the most. Sharp increases in oil almost always show up quickly at the pump. Declines in the price of oil, on the other hand, often translate into slower, more delayed drops in gas prices—the “rockets and feathers” effect.

The role of the U.S. Strategic Petroleum Reserve

When an emergency arises, the U.S. has a reserve of crude oil called the Strategic Petroleum Reserve. Its chief function is to secure energy during disasters like sanctions, severe storm damage, or war. It can also help take the edge off brutal price spikes when supply gets hit.

It’s not a solution for the long haul. It’s more of an immediate safety net to support consumers and keep crucial sectors of the economy running (think key industries, emergency services, public transportation, and the like).

How oil and natural gas prices are linked

Oil and natural gas are two of the main fuels that keep the world running. A big change in oil prices can end up affecting natural gas. As an example, if oil prices increase, some industries may sub natural gas for certain areas of their operations wherever possible. This can increase demand for natural gas.

Historical performance of oil

The oil market typically tracks two benchmarks:

• Brent crude oil (the main global oil benchmark)
• West Texas Intermediate (WTI) (the main benchmark of North America)

Between the two, Brent offers a clearer view of global oil performance because it prices much of the world’s traded crude. It’s also often the preferred gauge for tracking historical oil trends. In fact, the U.S. Energy Information Administration now uses Brent as its primary reference in its Annual Energy Outlook.

Looking at the Brent benchmark over multiple decades, you’ll find oil has been anything but stable. It’s seen sharp rises due to factors like wars and supply cuts, along with steep declines tied to global recessions and oversupply (called a “glut”). For example:

• The early 1970s saw the first major oil shock when the Middle East slashed exports and placed an embargo on the U.S. and others during the Yom Kippur War.
• Prices fell in the mid-1980s for reasons including lower demand and the entry of more non-OPEC oil producers.
• Prices jumped again in 2008 with increased global demand, but then plunged alongside the global financial crisis.
• During the 2020 COVID lockdown, oil demand collapsed like never before—bringing prices below $20 per barrel.

Bottom line, oil’s historical performance has been anything but smooth. It’s hugely affected by wars, recessions, OPEC whims, evolving energy initiatives and policies, and much more.

Energy coverage from Fortune

Looking to stay up-to-date regarding the latest energy developments? Check out our recent coverage:

• Oil prices may be falling, but for the wrong reason
• Why no nation is truly ‘energy independent’ while the Strait of Hormuz remains closed
• Markets haven’t rallied this fast since COVID

Frequently asked questions

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You don’t need to be in healthcare to realize that HBO Max’s The Pitt has become must-watch television, and it’s only partially because of its riveting pace and storylines. The Pitt shows what millions of Americans experience in real life. Emergency departments have been pushed beyond capacity with patients waiting hours for care that may not be truly emergent. The show’s chaotic hallways and overwhelmed staff aren’t just dramatic television but a reflection of a broken access point to our healthcare system.

The Pitt reflects very real challenges facing ERs across the country in the real world: overcrowding, chronic understaffing, long wait times, and patients who often require repeat care. ER workers are heroes, but the show showcases a hard truth: emergency departments were never designed to be healthcare’s front door, yet that’s exactly what they’ve become.

The solution isn’t more Dr. Robbys or bigger ERs, it’s reimagining how patients access care in the first place. Urgent care has the responsibility and means to become the accessible and appropriate front door that American healthcare desperately needs.

Urgent Care’s Role Has Expanded

Historically, urgent care filled an important but fairly narrow gap. If the emergency room felt excessive or a primary care appointment was not available, patients used urgent care for help. The visit was transactional. Treat the issue. Maybe make a referral. Then head home.

That role still matters, but it no longer reflects how people actually use healthcare.

Patients want speed, but they also want care that is connected. They want help when something goes wrong, but they also want support when they are trying to stay healthy and on top of their well-being.

That is where urgent care has a real opportunity.

With broad geographic reach, extended hours and walk-in availability, urgent care already serves as a trusted access point for millions of Americans. At American Family Care alone, our network of more than 400 walk-in clinics across the United States has delivered more than six million visits since January 2025 for a wide range of needs, from occupational medicine and pain management to physicals, flu, minor episodic issues and small injuries.

That kind of scale matters because it creates an opportunity to do more. Urgent care can help connect episodic care with broader, ongoing support in ways that make the system work better for patients. It can also help relieve pressure on both emergency departments and primary care practices, which badly need it. According to Becker’s Hospital Review, average ER wait times by state range from about 110 minutes in North Dakota to roughly 300 minutes in Washington, D.C.

That kind of variation says a lot about the pressure facing the system. It also reinforces why patients need better access points for care that is urgent, but not emergent.

A Good Example: Weight Management and GLP-1s

One clear example of this shift is weight management.

The rise of GLP-1 medications has changed the conversation around obesity and chronic disease. Originally approved to treat type 2 diabetes, these medications are now being used much more broadly for weight management, and that creates practical questions around access, monitoring and ongoing support.

Patients do not just need a prescription. They need responsible clinical oversight. They may need help with administration, follow-up, lab work, lifestyle support and regular check-ins. Too often, that means trying to navigate a system that is not built for easy, ongoing access.

Urgent care can help bridge that gap when the model is designed appropriately.

At AFC, we announced medically supervised weight management services at more than 30 franchise locations in March 2026. When clinically appropriate, GLP-1 medications may be prescribed based on clinical evaluation, FDA-approved indications and manufacturer guidelines. But medication is only part of the picture. Long-term outcomes also depend on diet, exercise, counseling, appropriate lab work and scheduled follow-up visits.

That is the bigger point. Patients are looking for trusted, accessible places to take control of their health. Healthcare providers should meet them there responsibly.

Medicine 3.0 and the Future of Access

Medicine 3.0 is increasingly becoming the term used to describe this broader evolution in healthcare. It emphasizes prevention, personalization and earlier intervention to improve long-term patient outcomes rather than waiting for diseases to appear. It is all about providing care for patients taking steps to prevent chronic, lifestyle-driven conditions like heart disease, diabetes and dementia.

Medicine 3.0 has been supported by advances in new technology like biomarkers, imaging, genetics, wearables and data analytics which enable earlier detections, but earlier intervention only works if patients can access care easily and consistently. That is where urgent care clinics like AFC can step in.

Urgent care clinics are well positioned to deliver this level of access. They can support prevention and chronic management without burdening emergency rooms or stretching primary care capacity. This expanded role might blur traditional lines of care, but when anchored in strong clinical standards, coordination and appropriate scope, urgent care only strengthens the system.

The Front Door Patients Are Already Using

The healthcare system does not need to convince patients to start using urgent care. They are already using it. The real question is whether the system will build around that reality intentionally.

Treating illness after it appears is no longer enough. Patients want access points that fit how they actually live and work. They want care that feels easier, faster and more connected. Urgent care is increasingly positioned to deliver exactly that.

The Pitt holds up a mirror to a healthcare system in crisis, but it also helps illuminate the path forward. Emergency departments will always be essential for true emergencies, but they can’t be the default entry point for millions seeking routine care. As viewers watch this week’s season finale, they’ll surely continue to see the competence and heroism of the ER staff, but they should also recognize the systemic failure that puts those workers in an impossible position.

The opportunity before us is clear: by intentionally building urgent care into a comprehensive, preventative-focused front door to healthcare, we can relieve the pressure on emergency departments, expand access for patients and create a system that works for the way people actually live.

The question isn’t whether healthcare needs a new front door. It’s whether we’ll invest in making urgent care everything patients need it to be.

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Canva, the Australian startup that’s won over 265 million users with its design software, is launching a new suite of tools that combine visual creation and workflow automation, run by AI agents that respond to conversational prompts

Dubbed “Canva AI 2.0,” the new platform of services lets users create and alter designs using natural language, and connects to other services like Gmail, Slack, and Zoom in order to generate new content. The new platform also boasts persistent memory, allowing Canva to learn how people work, and can automatically update designs as brand imagery gets tweaked. 

“We had to rearchitect the whole Canva platform,” Cliff Olbrecht, Canva’s co-founder and chief operating officer, tells Fortune. 

Canva, founded in 2012, integrated generative AI functions onto its platform in early 2023, just a few months after ChatGPT’s release. (At the time, Fortune noted that the startup was wary of using the term “AI” to advertise its services, preferring the term “magic” instead)

Olbrecht describes Canva’s previous AI services—generating images and video, or generating a whole presentation—as “a design platform with AI services built on top.” With these new services, Canva hopes to go beyond design to offer more coworking capabilities for users. 

For example, the new Canva can crawl the web for breaking tech news overnight, determine what’s trending, then create—and even schedule—social media posts on its own. “It can help you complete your whole job,” Olbrecht says. 

Canva’s rise in AI

Canva has quietly become one of the world’s most used consumer AI apps. Canva is the world’s third most used generative AI web product by monthly active users, behind Google Gemini and ahead of China’s DeepSeek chatbot, according to an analysis by VC firm a16z. 

Canva’s massive user base has pushed the company to think carefully about how to offer AI services without blowing a hole in its budget. “There’s only so long you can fund your user base with VC-funded dollars,” he says. “With 265 million users on a monthly basis hammering our services, we have to own our models and we have to own infrastructure that serves our models.”

Canva has acquired several other AI startups in recent years, including Leonardo AI, an image generating platform, in 2024. Just last week, Canva acquired Simtheory, a platform for building agents, and Ortto, a marketing automation company.

These investments have helped Canva produce its own foundational AI models, rather than solely relying on models from third parties. The startup claims that its AI services are seven times faster and 30 times cheaper than “comparable” frontier models. Obrecht adds that Canva is also trying to explore how to tap device processing power for AI, rather than go into the cloud. 

Canva will offer multiple tiers for pricing. Free users will get access to Canva’s basic AI, with a small number of credits for premium models. Pricing then escalates through different tiers all the up to $100 a month, which Olbrecht describes as “almost all-you-can-eat”—even if there are still some limits on Canva’s most powerful models. 

Software-as-a-service companies have been hit hard in recent months by investor fears about competition from AI developers like OpenAI, Google and Anthropic. Design software developers are particularly threatened by AI, as ChatGPT and Claude increasingly take on the ability to generate video and images. 

Shares in Adobe, which makes Photoshop and other design and publishing software, are down by over 30% over the past 12 months. Shares in design startup Figma have performed even worse, losing almost 85% of their value since the company’s $1.2 billion IPO. 

Canva, which is still privately held, claims it generated $3.5 billion in revenue last year. Obrecht, in an interview with Bloomberg last November, suggested an IPO was “probably imminent in the next couple of years.”

Olbrecht notes that, despite the so-called AI scare trade, Canva’s shares are still trading at its last valuation of $42 billion, reached during an employee stock sale last year. “We’ve fortunately avoided being hit by that SaaS apocalypse,” he adds. 

But he’s aware that rapidly changing technology can pose a threat to Canva if executives aren’t careful. “If we’re not going to disrupt ourselves, then we’re going to be disrupted,” he says.

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There’s a wild paradox in the middle of the biggest story in tech right now. The GPUs and other essential hardware that the hyperscalers are spending on so lavishly to pack into their data centers, it turns out, go obsolete in a hurry. That’s the view detailed in an excellent new report from Research Affiliates, a firm that oversees around $200 billion in investment strategies for its RAFI index funds and ETFs. Author Chris Brightman—he’s RA’s CEO—contends that the AI arms race has effectively created a new industrial era. In this transformed ecosystem, companies aren’t “investing” in the traditional sense. Rather, they are churning equipment at such an incredibly rapid tempo to generate sales that it’s changing the very definition of capital expenditures.

“They’re more like supermarkets than traditional tech or industrial enterprises, but their turnover isn’t in the likes of grocery items. It’s the stuff that generate their large language models, vector search, and other products,” Brightman told me in a phone interview. “They’re in an arms race where they need to replace their hardware very rapidly, in other words, restock their shelves in a hurry.” The problem, Brightman asserts, is that hyperscalers are taking losses on the large language models, vector databases, and other products they’re selling to companies and consumers, so the more hardware they buy, the more money they lose. “Right now, each is using AI to maintain crucial dominance in their field, and that makes sense,” Brightman observes. But, he adds, the immense spending needed to maintain those “moats” and keep rivals at bay could generate puny returns going forward, and harm their overall profitability.

In the article, Brightman spotlights the historic surge in AI capital expenditures (capex) that has mushroomed from $250 billion in 2024 to $650 billion this year by Bloomberg’s estimate, equal to 2% of GDP. That industry’s historic appetite for capital spawned the view that AI is becoming the new steel or railroads. But as Brightman points out, the equipment and infrastructure that supported those businesses is far different from the gear that drives AI. “Steel mills and rail tracks depreciated over 40 to 45 years,” he writes. He then contrasts those multi-decade useful lives to the scenario in AI. Hyperscalers such as Microsoft, Amazon, Alphabet, and Meta are depreciating their GPUs and other hardware over roughly five or six years on their income statements. Although those spans appear short, he says, their real “lives” are much shorter.

In an economic sense, assets become fully depreciated, or turn obsolete, when the revenues they generate no longer cover their cost of acquisition (reflected in yearly depreciation), operating expense, and cost of capital. According to Brightman, the industry numbers show that AI hardware loses its value over about three years. As proof, he cites data on the profitability of Nvidia’s industry-standard H100 GPUs. In their second year, an H100 spawned $36,000 in annual profit for a 137% return on investment. But by year four, the product was losing over $4,400 for a negative ROI of 34%, and the results sank fast from there. Writes Brightman: “The economic life of AI hardware is [a lot] shorter than its accounting life.”

It’s not that the equipment wears out. Physically, it can actually run a lot longer. The reason AI hardware loses potency so fast: Nvidia, AMD, and the other producers are crafting fresh offerings that each year provide enormous increases in computing power per watt deployed. Since the hyperscalers face tough energy constraints, they are constantly seeking gobs of new “compute” using dollops of extra electricity. Normally, if typical manufacturers were adding capital at the pace the hyperscalers are setting in AI, they would already have built a gigantic base of equipment and infrastructure they could deploy for years, without the need to keep buying more. Not so in this brave new business. AI equipment is evolving so fast that each year, the hyperscalers need to replace an immense part of their capital base just to maintain the same capacity for forging AI wonders. “Most of their spending isn’t growth capex, it’s ‘maintenance’ capex,” says Brightman. Nevertheless, the overall numbers are so huge that although only about one-third goes to expansion, that’s still good enough to hugely grow the volume of products and services they can deliver each year.

The hyperscalers are using AI, and taking big losses, chiefly to protect their turf

On our phone calls, Brightman nailed the conundrum for the giants of AI. “As they ramp the compute, they lose more and more money,” he says. “But they have plenty of rationale to do so for now.” All of the Big Four aim to provide the best AI features to enhance their signature offerings, and recognize that they will lose their leadership in those staples if the AI component isn’t top-notch. Amazon makes most of its money providing computations and storage in the cloud. It’s unable to recoup nearly the cost of the AI additions from its customers, says Brightman. “But it’s sensible because if Amazon doesn’t stay in the arms race, they’ll lose the cloud business. They need the AI services as part of the cloud component.”

As for Microsoft, its staple is office software that generates subscription revenues, notably on its 360 platform. That franchise now faces stiff competition from Google’s docs and sheets products. “To protect its existing business and keep its customers, Microsoft has to offer AI model services, even if it’s losing money on its AI capex,” declares Brightman. Alphabet is preeminent in “search,” and cleans up as the world’s biggest seller of online ads. Microsoft has mounted a challenge by launching its own search engine. “To continue its profitable line of business and keep its edge, Alphabet needs the AI element, and that requires big investments in data centers,” says Brightman.

Meta has to worry about the other three invading its highly lucrative, social media advertising business. “People come to their platform to see the pictures and the video, and it costs Meta a lot of money to produce that content that supports the ads,” notes Brightman. Meta uses AI to personalize feeds for users, rank content on Instagram and Facebook, and check posts for safety, and needs those uses to maintain its lead. Yet once again, says Brightman, it can’t yet charge enough for its ads to pay for its gigantic new spending needed to provide those fantastic features.

Brightman concludes that the gusher in AI investment doesn’t mean that this revolutionary advance will prove a big profit spinner for the Big Four. It’s more a weapon for each titan to defend its domain. “When capital turns over rapidly, and competition forces continuous reinvestment, extraordinary spending can sustain competitive position without creating value for shareholders,” he states in the article. Once again, the shelf life of what’s filling our data centers is so brief that buying GPUs, say, is more like replenishing supermarket stocks than building factories that endure for decades.

AWS CEO Andy Jassy has a very different take. In his latest annual letter to shareholders, he stated that AWS chips, servers and networking gear have a useful life of 5-6 years.

On the other hand, Brightman told me, the stuff that is costing these champions big-time helped him greatly in preparing his analysis. “A year ago, this project would have taken me nine months to do the research and modeling. But I used the best of Claude, ChatGPT, and Gemini, and synthesized their feedback, and did it start to finish in three weeks,” he recounts. Brightman’s vignette tells the story: This new industrial era may be a lot more beneficial to the folks and businesses that use the AI-enhanced products than the enterprises that furnish them.

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Each year, I produce Hanke’s Annual Misery Index (HAMI). They call me the “money doctor” for my globe-spanning career of economic advisory missions, and by using readily available economic data, I can measure the temperature of the patient, so to speak, to determine just how “miserable” or “healthy” an economy is.

The idea of a misery index was fathered by Arthur Okun, a distinguished economist and Yale professor who served as chairman of the President’s Council of Economic Advisers from 1968 to 1969 during President Lyndon B. Johnson’s administration. Johnson wanted an easy way to take the economy’s temperature. Okun’s index, which he used for the United States, is equal to the sum of the inflation and unemployment rates.

Okun’s misery index was modified by Harvard professor Robert Barro in 1999, by including the 30-year government-bond yield and the difference between the long-term-trend rate of real GDP growth and the actual rate of real GDP growth.

In 2009, I amended Barro’s version of the misery index by replacing the 30-year government-bond yield with lending rates, and by replacing the difference between the long-term-trend rate of real GDP growth and the actual rate of real GDP growth with the growth rate of real GDP per capita.

Then, in 2022, I made a further amendment to HAMI. Following Andrew Oswald’s (University of Warwick) suggestion, I decided to double the weight put on the unemployment-rate component in HAMI. The intuition is that an additional percentage point of unemployment hits people a lot harder than an additional percentage point of inflation. So, HAMI is the sum of the year-end unemployment (multiplied by two), inflation, and bank-lending rates, minus the annual percentage change in real GDP per capita.

Some might protest that the inflation rate and bank lending rate are correlated, and therefore HAMI double-counts the effects of inflation. Similar to the doubling of the unemployment weight, this is by design. The logic for this is rooted in loss aversion: People perceive losses as more significant than gains. Therefore, two items that contain inflation are included while the growth rate in real GDP per capita, a gain, is not double weighted.

Unlike Okun and Barro, who focused on the United States, HAMI covers many foreign countries; 178 are included in the 2025 edition — a new record.

Sources: Economist Intelligence Unit (including estimates), International Monetary Fund World Economic Outlook, World Bank, International Labor Organization, and individual Central Banks and Statistical Institutes of each country.

Note: The Misery Index is the sum of the unemployment rate multiplied by 2, the end-period consumer prices rate, and the lending rate, minus the growth in Real GDP Per Capita. The median of the 2025 Annual Misery Index is 21.85. The mean of the 2025 Annual Misery Index is 31.64.

Calculations by Professor Steve H. Hanke, The Johns Hopkins University

The Rankings in Context

The 20 countries that are most miserable in 2025 are, once again, a familiar rogue’s gallery. Of the 20 most miserable countries in 2024, 17 remain in 2025’s top 20. Syria — which occupied a dismal third place in 2024 — has made the most dramatic exit, plunging all the way to 33rd following the fall of the Assad regime. Egypt and São Tomé and Príncipe have also departed. In their place, Botswana, Bosnia and Herzegovina, and Brazil have entered, reflecting persistently high unemployment and elevated borrowing costs. At the happy end of the HAMI distribution, Taiwan retains the title of the world’s happiest economy for the second consecutive year, and Ireland — powered by extraordinary GDP growth — has climbed an impressive 54 positions to become the fourth-happiest economy on earth.

The ten most miserable countries in the world in 2025, listed by descending rank order, were Venezuela, Sudan, Turkey, Iran, Argentina, Eswatini, South Africa, Malawi, Madagascar, and Lebanon. I highlight the first three.

Venezuela: A Catastrophe Without Precedent

Venezuela seizes this year’s top position as the world’s most miserable country, with a HAMI score of 556.5 — the highest recorded in the 2025 edition and a devastating increase from its sixth-place ranking in 2024. The story is one of an accelerating collapse. The Maduro regime, having stolen the July 2024 presidential election and suppressed the democratic opposition by force, triggered a new wave of international sanctions that choked off oil revenues and sent the bolívar into free fall. The Banco Central de Venezuela’s own belated disclosure reveals that consumer prices rose 475.3% in 2025 — the highest inflation rate in the world. Unemployment, meanwhile, surged to 35.1%, reflecting the hollowing-out of a once-diversified economy. With the lending rate at 9.4% and real GDP per capita contracting by 1.6%, every component of HAMI conspires against the Venezuelan people.

Venezuela’s score is not merely the highest in the 2025 edition; it is among the highest ever recorded by HAMI. Until Venezuela replaces the bolívar with the U.S. dollar and establishes the rule of law and property rights, it will remain the world’s most miserable country.

Sudan: Civil War Without End

Sudan drops from first place in 2024 to second, but any improvement in relative standing offers cold comfort to the Sudanese people. The civil war between the Sudanese Armed Forces and the Rapid Support Forces — now in its third year — continues to devastate economic activity, displace millions, and fuel inflation. Sudan’s unemployment rate remains an extraordinary 55.7% — the highest in the world — reflecting the near-total destruction of formal labor markets in the war zones. Inflation, which peaked above 200% in 2024, has moderated to 68.1%. But the bank-lending rate remains at 37%, and real GDP per capita has contracted by 8.9%.

Until the guns fall silent, the HAMI will keep Sudan near the top of the world’s misery rankings.

Turkey: The Interest-Rate Trap

Turkey rises two ranks to third most miserable with a HAMI score of 101.0, driven primarily by a bank-lending rate of 56.7% — the highest in the top ten. Since the Central Bank of the Republic of Turkey reversed its unorthodox monetary policy in mid-2023 and embarked on an aggressive tightening cycle, lending rates have reached punishing levels. Inflation has come down from its 2024 peak but remains elevated at 30.9%. Unemployment stands at 8.4%. Turkey will only come down on HAMI if it adopts a currency board, like the one I helped design and implement in Bulgaria in 1997.

The Year’s Most Notable Movers

Syria: From Third to Thirty-Third

Syria’s improvement of 29 positions — from 3rd most miserable in 2024 to 33rd in 2025 — is among the most remarkable stories in this year’s edition. In December 2024, a rebel offensive led by Hayat Tahrir al-Sham swept through the country with stunning speed, toppling the Assad regime that had ruled Syria since 1970.

The economic effects have been immediate. Syria’s consumer prices fell 12.2 percentage points in 2025, reflecting both the disinflationary shock of regime change and the easing of some war-era supply bottlenecks. But the HAMI score of 41.2 still reflects deep structural damage: unemployment remains at 18%, and real GDP per capita contracted at an annual rate of 5.4%.

Argentina: Progress, Not Yet Salvation

Argentina improves from being the 2nd most miserable country in 2024 to 5th in 2025, with its HAMI score falling from 195.9 to 88.4. This is a tribute to President Javier Milei’s shock-therapy program: inflation fell from 118% to 31.5%, and real GDP per capita grew by 4.0%. However, Argentina’s bank-lending rate stands at a punishing 46%, reflecting the residual cost of years of monetary mismanagement. Unemployment is 7.4%.

Argentina’s improvement of more than 107 HAMI points in a single year is nonetheless noteworthy. It is the largest score reduction of any country in the 2025 edition and a compelling case study in what a determined government can accomplish when it chooses economic sanity over populist spending.

Bolivia: The Year’s Largest Deterioration

Bolivia’s collapse of 47 positions — from 75th most miserable in 2024 to 28th in 2025 — is the largest deterioration of any country in this year’s edition. Bolivia’s HAMI score of 44.0 is driven by a sharp surge in inflation to 20.4%, as the country’s foreign-exchange reserves have been depleted and the government’s ability to maintain its fixed exchange rate has come under severe strain. Real GDP per capita contracted by 1.4%.

Burkina Faso: The Largest Improvement

Burkina Faso’s climb of 69 positions — from 101st most miserable in 2024 to 170th in 2025 — earns it the distinction of the single largest rank improvement in the 2025 edition. Consumer prices actually fell 2.2%, the lending rate declined, and unemployment edged lower, all of which combined to push its HAMI score to just 7.4 — placing it among the ten happiest economies in the world. The improvement is partly driven by favorable commodity dynamics and a statistical rebase, but it is nonetheless a striking result for a Sahelian nation grappling with insurgency and political instability.

Ireland: Growth as a Superpower

Ireland’s ascent of 54 positions — from 121st most miserable in 2024 to 175th in 2025 — makes it the fourth-happiest economy in the world and the second-largest rank improver. Ireland’s engine is a stunning real GDP growth per capita of 11.2%, fueled by multinational corporate activity and Ireland’s position as a European hub for technology and pharmaceutical firms. With unemployment at 4.7%, inflation at 2.7%, and a lending rate of 4.4%, Ireland’s economic headwinds are modest — though it bears noting that Ireland’s GDP figures are well-known to be inflated by multinational corporate booking activity, a quirk that may overstate the welfare gains felt by ordinary Irish residents.

Iran: Sanctions Bite Harder

Iran’s deterioration of 12 positions — from 16th most miserable in 2024 to 4th in 2025 — places Iran in the world’s top five most miserable economies for the first time since the HAMI began its modern coverage. The dominant driver is inflation at 52.6%, fueled by chronic fiscal deficits, ongoing sanctions, and a depreciating rial. The bank-lending rate of 24% adds to the burden. With real GDP per capita contracting by 2.9%, every arrow in Iran’s HAMI points in the wrong direction.

The World’s Happiest Economies

The ten happiest countries in the world in 2025, listed by ascending rank order, were Taiwan, Singapore, Thailand, Ireland, Côte d’Ivoire, Macau, Japan, Qatar, Burkina Faso, and Guinea-Bissau. I highlight the top three below.

Taiwan: The World’s Happiest Economy

Taiwan retains the title of the world’s happiest economy for the second consecutive year, with a HAMI score of 2.1 — the lowest of any country in the 2025 edition. The secret ingredient is real GDP growth per capita of 9.2%, powered by insatiable global demand for Taiwan’s semiconductors and artificial intelligence hardware. Unemployment is low at 3.3%, inflation subdued at 1.3%, and the bank-lending rate at 3.3%.

Geopolitical threats from China notwithstanding, Taiwan’s economy in 2025 is firing on all cylinders.

Singapore: Monetary Discipline Made Manifest

Singapore is a perennial contender at the happiest end of the HAMI, and 2025 is no exception. With a score of 2.6, Singapore’s performance reflects near-full employment at 2.0% unemployment, well-anchored inflation at 1.2%, and solid GDP growth of 4.3% per capita.

Thailand: Consistent Excellence

Thailand is the third-happiest economy in the world in 2025, with a HAMI score of 3.1. Consumer prices actually fell 0.3% — mild deflation — while unemployment stayed at 0.8%. Real GDP per capita grew 2.5%. Thailand’s consistent appearance near the bottom of the HAMI table is no accident: the Bank of Thailand’s monetary framework has delivered low inflation and stable employment for more than a decade.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Nearly every week, the headlines about AI are dominated by the news of the latest model. A few days ago, Meta announced its newest model called Muse Spark – its first under its revamped AI division. According to their internal benchmarking tests, the new model is competitive with leading rivals across several tasks. 

However, each new model release reveals something counterintuitive: as more models flood the market, the more they become commodities. If that’s the case, then the question becomes: what is the differentiator for businesses trying to adopt and scale AI? 

The answer comes down to one word – trust. 

Over time, the model that sits on your desk is going to matter less than the trusted, connected intelligence that feeds into it. I think of connected intelligence as curated data drawn from multiple, organized sources. As a result, an AI model can reason across all of the data at once rather than working from a single, incomplete picture.

Here’s another way to think of it: AI models are the cars we’re driving and they’re improving every day. However, data and intelligence are the navigation system – the difference between knowing you’re moving and knowing where you’re going. A basic GPS running on an outdated map might get you somewhere – but will it get you there reliably and quickly? 

Maybe.

But “maybe” isn’t good enough when it comes to high-stakes decisions – especially in financial services. We’re talking about some of the world’s most consequential decisions that impact people’s ability to get a loan, receive affordable insurance, and keep their money safe from financial criminals. These models need a source of truth to reason on – otherwise, we’re not only increasing the odds of poor outcomes, we’re gambling with public trust precisely at a time when trust in institutions is in worldwide decline.

NVIDIA CEO Jensen Huang made this point recently when he said, “Structured data is the ground truth of AI.” He was identifying what the industry has been slow to acknowledge: that a powerful model requires trusted data. And not all data earns that distinction. 

Data needs to be organized, normalized, and calibrated against the way the world actually works. It’s painstaking work and can’t be done just by scraping the web, which is why organizations that marry the best models with this kind of connected intelligence will build trust. In addition, it will also ensure that decisions based on AI can be defensible to boards, regulators, customers, and shareholders. 

The consequences of getting the data foundation wrong are already showing up. According to MIT, 95% of AI pilots are failing to deliver measurable impact. That’s partially because the data foundation is too weak. More powerful models don’t solve this problem – if anything, they make the consequences of producing a bad output harder to detect and more costly to reverse. 

Read the news and the risks of a bad output are obvious: tariffs are reshaping global trade overnight, geopolitics are redrawing supply chains, extreme weather events are defying historical models, and cyberattacks are targeting critical infrastructure. As the World Economic Forum’s Global Risks 2026 report makes clear, risks continue to spiral in scale, interconnectivity, and velocity. 

For banks, insurers, and asset managers, this connectedness is not theoretical – it’s the difference between being reactive to risk and getting ahead of it.  In this era of Exponential Risk, the defining challenge is not only that threats are growing in magnitude – they are also growing in connectedness. For example, an extreme weather event that damages infrastructure could impact a critical supply chain node, which has a derivative impact on economic growth and credit. For a financial services company, using generic AI coupled with fragmented data cannot get you a defensible answer on how to assess those risks. However, connected intelligence – spanning different data sets on climate, credit, and compliance – can get you closer to an answer you can trust. 

As more data sources are unified, a picture of risk emerges that is fuller, more precise, and more actionable than anything a siloed approach can produce. That’s why companies that unite data from third parties alongside the data they own will be the ones who make better, faster decisions – and can defend those decisions when it counts.

Over the last three years, the complexity and capability of models has drastically improved. However, it’s time to start focusing on perfecting the intelligence behind them. These are not decisions reserved exclusively for engineers. They are for anyone serious about unlocking the true power of AI. Every organization deploying AI at scale needs to ask its data teams the same question it asks AI vendors: is this intelligence reliable, connected, and tested against real outcomes?

Because the stakes go beyond revenue and growth, they also matter for anyone who’s concerned about strengthening the institutional trust markets run on. Moody’s was founded over a century ago on the conviction that markets function better when everyone has access to transparent, rigorous, and independent data and analysis. That is as true today as it was then, and AI doesn’t change that principle – it just raises the cost of getting it wrong.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Good morning. On Fortune’s radar today:

• Markets: Record highs!
• Meet the anti-AI groups facing questions after the attack on Sam Altman.
• Peace is in danger of breaking out in the Middle East.
• Why the price of oil doesn’t go down even when you are self-sufficient in it.
• Jamie Dimon sells $40 million in stock.
• Diamonds are really cheap.

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Most people have called in sick at least once. But in Germany, workers have been taking more than one day off sick every month for the past year—and the government has had enough. Now, it’s proposing to dock workers’ wages.

German workers take an average of 14.8 sick days per year, giving the country one of the highest rates of absenteeism in Europe. For context, that is four times the UK’s sick leave rate. 

And it’s costing the country’s businesses around around €82 billion ($110 billion) a year, according to the German Institute for the Economy.

So, now Chancellor Friedrich Merz is reportedly considering a drastic solution: turning to workers to front that cost. 

German workers who take 5 or fewer days off sick will get a bonus 

Currently, the country has a very generous sick leave policy: up to 6 weeks (30 working days) fully paid for the same illness, with a doctor’s note. They can take 5 days off sick without seeing a doctor in person, before needing to get a formal extension. And if the employee gets sick again due to a different illness, the 6-week period restarts. 

The Christian Democratic Union’s (CDU) proposed plans would see workers’ pay docked from the very first day they call in sick. Meanwhile, workers who take 5 days or fewer would receive a bonus. 

The goal, according to German tabloid Bild — which broke the story over the weekend — is to nudge workers with minor ailments, like a cold, back into the office rather than reaching for the phone. 

As one government insider put it: “It’s certain that Germany has the highest number of sick days in Europe. Both coalition partners would like to reduce that.”

In 2023, Germans called in sick nearly 20 times a year—a record high. That figure has since fallen by around 5 days, but bosses have still been complaining about “work-shy” Gen Z exploiting the system amid persistently high rates compared to other European countries. 

Merz, meanwhile, has made his feelings towards Germany’s sick leave culture clear: Earlier this year, he underscored just how many weeks of 14.8 days leave employers high and dry: “That’s nearly three weeks in which people in Germany don’t work due to illness,” he stressed. “Is that really necessary?”

He’s also blamed the Germans’ lifestyle approach to work for the country’s low productivity. Merz said in a recent speech: “To put it even more bluntly: Work-life balance and a four-day week will not be enough to maintain our country’s current level of prosperity in the future, which is why we need to work harder.”

Fortune has reached out to the German government for comment.

Burnout is becoming a major global issue

Although Germans are leading the charge, they’re far from the only workforce cracking under pressure. Burnout has become one of the defining workplace crises of the post-pandemic era—and the data suggests it’s getting worse, not better.

One shocking study highlights that 54% of American workers report feeling unhappy at work, with the frequency ranging from occasionally to constantly. Yet they’re still showing up for their jobs, sitting at their desks, and silently emotionally struggling.

Office overachievers are so burned out that workplace experts have taken stock of the phenomenon and even given it a name: a “competence hangover.” 

Research consistently shows it’s millennials who are burned out the most—the generation has wound up in middle management and bearing the brunt of layoffs. And in the UK, a mental health crisis among young workers is fuelling a surge in workplace anxiety, stress, and absenteeism that employers are struggling to get a handle on. They’re mentally checked out, on average, for one day each week.

It’s perhaps unsurprising that, at the same time, research shows office politics have made a major comeback post-pandemic: Return-to-office mandates, AI-driven efficiency, and layoffs have caused backstabbing and “workplace incivility” to spiral.

It’s gotten so bad that burned-out workers are phoning in sick and increasingly using medical leave as a way to escape—not because they’re actually unwell but just to mentally recover from their “toxic” bosses, decompress, and even job hunt. It perhaps might explain why Germans are pulling sickies so often.

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The shocks keep coming. The question is whether we help smallholder farmers face them together — or leave them to face them alone.

Right now, that question is urgent. Renewed conflict across the Middle East has disrupted shipping through the Strait of Hormuz — a chokepoint through which roughly a third of the world’s seaborne fertilizer passes. Urea prices have jumped sharply. Ammonia is at a three-year high. And somewhere in Kyrgyzstan, Bangladesh, or Benin, a smallholder farmer is doing the math on whether she can afford to plant this season.

For wealthy, large-scale producers, these shocks are painful. For smallholder farmers in low-income countries, they can be catastrophic. Unlike commercial producers, smallholders typically buy inputs at retail prices and operate on margins so thin that even a modest price rise can wipe out an entire season’s income.

This is not a new story

When Russia invaded Ukraine in 2022, disruption to Black Sea commodity exports pushed an estimated 349 million people deeper into food insecurity. Before that, the COVID-19 pandemic fractured supply chains and decimated rural livelihoods. And before that, the 2007–08 food price crisis raised agricultural commodity prices by over 100%, plunging 150 million people into extreme poverty — and prompting the creation of the Global Agriculture and Food Security Program (GAFSP).

Each of these crises confirmed something that agricultural development practitioners have long observed on the ground: smallholder farmers operating alone are deeply exposed, whereas those embedded in strong producer organizations are fundamentally more resilient.

The logic is simple — the difference is institutional

An individual smallholder facing a 50% rise in fertilizer costs has almost no recourse. She cannot negotiate with a supplier, bulk purchase, or draw on an institutional credit line. Her options are to use less fertilizer — accepting lower yields — or take on debt. Either way, she pays a heavy price.

A farmer embedded in a well-functioning producer organization faces the same price spike, but with meaningfully different options. The organization can pool demand to negotiate collectively, stockpile resources, and access credit on behalf of its members.

This is the difference between a shock that is weathered and one that forces a family off the land entirely.

The evidence is not theoretical

In Kyrgyzstan’s remote Batken region — the country’s poorest — the agricultural cooperative Mol-Tushum was on the brink of collapse following the economic disruptions of COVID-19. With GAFSP support, the cooperative procured and distributed over 300 tons of mineral fertilizer to its members, who saw yields rise by 30% to 40%.

Crucially, the impact went beyond inputs. Farmers who had lost faith in collective action began to re-engage. The cooperative used that rebuilt trust to introduce improved seeds, establish organic composting, and develop greenhouse infrastructure with drip irrigation. What began as crisis response became the foundation for long-term resilience.

This is a model that works at scale. GAFSP has approved $38.75 million in new grants supporting 16 producer organization-led projects across 27 low-income countries — from West Africa to South Asia to the Americas — expected to directly benefit 175,000 smallholder farmers. From cooperatives strengthening women’s land tenure in Benin to climate-smart agriculture networks in Sri Lanka, each project is different, but the underlying logic is the same: build the institutions that connect farmers to credit, markets, and the financial tools they need to trade their way through volatility, rather than be crushed by it.

The window to act is narrowing

The current situation in the Middle East may not resolve quickly. Fertilizer prices could stay elevated for months, rippling through harvests, food prices, and household food security well into the year. The immediate impact on the global North may be limited — many farmers will have already made input purchases for spring planting. But a prolonged conflict could affect planting decisions and yields in the Southern Hemisphere, and fertilizer applications for rice across South and Southeast Asia.

This matters especially as aid budgets decline across across major donor countries. Policymakers and international donors who want to respond effectively should resist the temptation to reach only for short-term, externally administered relief. Emergency humanitarian response remains essential — but this moment also demands a longer-term commitment to the institutional infrastructure that allows smallholders to grow, thrive, and absorb the next shock.

World Bank platforms like GAFSP and AgriConnect are doing precisely that — transforming smallholder agriculture by de-risking investments, bridging infrastructure gaps, and connecting producers to markets in ways that unlock private capital at scale. As donors gather in Washington for the Spring Meetings this week, scaling up this kind of investment is one of the most effective responses available.

Producer organizations are cost-effective, demand-driven, and self-reinforcing. Investment in their capacity generates returns that compound over time. We know what works. The evidence spans crises and continents. The infrastructure exists.

The shocks will keep coming. The only question left is whether we fund the institutions that let farmers face them together — before the next one arrives.

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With the planting season ending in six weeks, skyrocketing fertilizer prices are forcing farmers into an impossible choice: cut back and lose crop yield or stay the course and lose money.

A survey published Tuesday of 5,700 farmers conducted by the Farm Bureau shows that around 70% of farmers are unable to afford all the fertilizer they need, while nearly six in 10 said their finances have worsened due to the rising cost of both fertilizer and fuel. 

The new data comes as the Iran war has strangled the global supply chain as Iran exerts its control over the Strait of Hormuz, through which one-third of the global fertilizer shipments flowed before the war. While more than 20 commercial ships passed through the strait over the past several days—an improvement from earlier this month when Iran essentially shut down the strait—it’s unclear whether the flow of ships will improve as the war drags on well nearing its seventh week, despite a ceasefire between the U.S. and Iran signed last week, and a potential extension on the way.  

As a result, prices for the three major fertilizers farmers use (nitrogen, phosphorus, and potassium), have all increased by double digits, according to Josh Linville, vice president of fertilizer at financial services firm StoneX Group. 

It is the 6-week anniversary of the closure of the Strait of Hormuz. Fert price comparisons:

NOLA urea – +$230 or 49%
NOLA UAN – +$145 or 38%
Midwest NH3 – +$245 or 32%
NOLA DAP – +$130 or 21%
NOLA potash – +$10 or 3%

…corn – 2-cents or 0.5% higher#sickeningforfarmers

— Josh Linville (@JLinvilleFert) April 10, 2026

Farmers struggle as fertilizer prices rise

These rising fertilizer prices are taking a toll on farmers who for years have struggled with low commodity prices for the two major crops grown in the U.S., corn and soybeans, which have fallen 40% and 37%, respectively, from their highs in 2022. As of this week, the average price of corn was hovering at $4.15 per bushel down from a high of $6.86 a bushel in 2022. The average price of soybean was $10.30 per bushel, down from a high of about $16.40 in 2022, according to the United States Department of Agriculture (USDA). 

The decision to cut back on fertilizer is weighing most on farmers in the South, where only 19% of farmers bought fertilizer ahead of time, according to the Farm Bureau report. The crops these farmers grow—cotton, rice, corn, soybean, and peanuts—rely heavily on added nutrients which leaves them most at risk when fertilizer prices increase, the report claimed.

Farmers’ limited time before planting season ends

The clock is ticking. These farmers have only until the middle of May when planting season ends to decide whether they will scale back on their fertilizer use—which in the long run could lead to lower crop yields—or absorb the elevated costs and potentially lose money on their harvest. Otherwise, some farmers may even choose to sit out the season and potentially add debt through borrowing to make ends meet, Bryan Hansel, chief revenue officer at regenerative agriculture company Holganix, told Fortune.

“This is heart-wrenching for farmers to decide, do I lose money, or do I cut fertilizer, or, like, what do I do?” he said.

To reduce farmers’ demand on fertilizer, one of the best options may be regenerative farming, said Hansel, whose company sells a product, Bio 800, which helps build up the microbiome of topsoil.

Farmers’ overreliance on fertilizers

Decades of American farmers’ overreliance on both fertilizers and quick chemical solutions like pesticides and herbicides have slowly chipped away at soil health for decades. A February report by the Union of Concerned Scientists found that every year, U.S. farmers apply between 30% and 50% more synthetic nitrogen fertilizer than their crops need. These fertilizers cost farmers an estimated $35.8 billion in 2023, according to the USDA.

Heavy fertilizer use has trapped farmers in a vicious cycle. Constantly using more fertilizer than crops require degrades the soil’s natural microbiome, making soil less productive over time, which requires farmers to use more fertilizer to compensate. Reducing fertilizer use would increase crop yields and cut costs for farmers, the study claimed.

And yet, farmers have been hesitant to switch to regenerative farming techniques that, among other adjustments, include putting a stop to over-tilling, which can cause damage to soil structure. Farmers can also plant cover crops, such as grasses or legumes, or rotate the crops grown in each field yearly that can improve the nutrients and organic matter in the soil.

But because these methods often take years to start showing effects—and because American farmers have relied on fertilizers to enable steady crop yields for so long—some are hesitant to sway from the norm, Hansel said.

Rising fertilizer prices may be changing the equation: Demand for Holganix’s Bio 800, which serves as a sort of probiotic for topsoil, has doubled compared to last year, Hansel said, partly because it can help reduce fertilizer needs in a shorter time compared to other regenerative farming methods.

While most farms use at least one regenerative farming method, such as reducing tilling, only about 1.5% of the more than 300 million acres dedicated to row crops in the U.S. are farmed fully regeneratively, according to Regenerative Farmers of America.

Much of the reason why can be explained by the fact that for regenerative farming to work, farmers have to reduce the amount of fertilizer they use, a distressing change for some given the common belief reducing fertilizer brings lower crop yields, Hansel said. 

However, if fertilizer costs continue to rise, farmers may have no better alternative. 

“Nature is no longer on our side, helping us raise these crops,” Hansel said. “It’s chemistry that something has raised these crops. We need to reverse that.”

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• In today’s CEO Daily: Europe Editorial Director Kamal Ahmed reports on a conversation with Demis Hassabis.
• The big leadership story: Everyone’s anxious about AI—even founders.
• The markets: Mostly up as tech optimism returns.
• Plus: All the news and watercooler chat from Fortune.

Good morning. Not every CEO will have a book written about them. But if they do, what should they try to get out of it? For Demis Hassabis that moment has arrived with the publication of The Infinity Machine, the new biography written by Sebastian Mallaby (author of More Money Than God on hedge funds and The Man Who Knew, the biography of Alan Greenspan).

Hassabis, co-founder of DeepMind and Isomorphic Labs, knows that the book changes his relationship with the public. “I am a pretty private guy,” he said at a launch event in London this week. The 1,000-seater venue was sold out, filled with a mix of young people keen to know about the future of work and older generations concerned that artificial intelligence will upend the world as we know it.

I was there, alongside the academics and senior technology executives, to listen to one of the few Tech Gods to work outside the hothouse of the U.S. and more specifically, Silicon Valley.

Here are my three takeaways from the 60-minute conversation:

1. AI leadership needs to be dispersed. Hassabis finds London attractive as the headquarters for Google DeepMind because it is not in America. He has nothing against Americans, of course; Alphabet has owned DeepMind since 2014. But he believes we need different centers of excellence around the world to mitigate the risk of AI becoming a product of a certain way of thinking. “The people that are making artificial intelligence shouldn’t just be from 20 square miles of the U.S.,” he said. “It’s going to affect the entire globe. So I think a global perspective on AI, what it should be used for, how it should be deployed, the ethics of it, the technology itself, [is important].”

2. The commercial race isn’t the most important one. Amid all the commercial noise on who is winning the chatbot war—Anthropic, OpenAI, Google, Perplexity, a host of others—we are probably missing something more fundamental. Who is providing the guardrails to mark the boundaries of acceptability? “At the back of my mind, I’ve got this gnawing feeling that there’s something much more important, much bigger than the commercial race, which is getting AGI safely over the line for humanity and to make sure that the benefits fully outweigh the risks. And, you know, I’m going to try,” Hassabis said. In the present geo-political environment, he admits such a task is going to be “very hard.”

3. Education needs a rethink. It sounded like a throwaway point but actually wasn’t: Hassabis argued that we need to completely upend education so that learning in the classroom is a collaborative process between pupils and teachers (how to solve problems, find new pathways) rather than a traditional place to “learn” facts and figures. “We should be really reconsidering education from the ground up . . . invert the classroom, so that it becomes more about collaboration and project-based and creative problem solving,” Hassabis said. “Then you do the rote learning outside of the class, where you do it with your AI systems and it is personalized to you.”

The first takeaway is fact, and it works. The second is a hope that is one almighty challenge. And the third is a suggestion about the future that should happen, and if it doesn’t we should be asking politicians and teachers why. For my full piece on Hassabis and the future of AI—and what he thinks “doing his best” really means—read more here. —Kamal Ahmed

Contact CEO Daily via Diane Brady at diane.brady@fortune.com

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The researchers, doctors, and child development experts have studied what generative AI does to developing brains. Their conclusion: it shouldn’t be anywhere near a classroom, and action needs to happen fast.

“We just don’t want to waste another 10 years in which our kids’ education is undermined,” Leonie Haimson, executive director of the Parent Coalition for Student Privacy, told Fortune. “It took more than 10 years to ban cell phones from schools. We can’t afford that again.”

Boston-based child advocacy nonprofit Fairplay is leading a coalition of more than 250 experts and organizations in calling for a five-year moratorium on all student-facing generative AI products in Pre-K through 12 schools in the U.S. and Canada. The group, made up of a coalition of mental health experts, parents, educators and groups geared towards protecting children online, warned that any product that fails safety testing during that pause should be permanently banned. The report, shared exclusively with Fortune, will be released right when advocates plan a rally in front of New York City’s City Hall to push for a two-year ban in the city’s public schools specifically.

Fairplay last month led a similar coalition of experts in penning a letter to YouTube and its parent company Alphabet to stop the spread of “AI slop” in YouTube Kids videos. The report was co-authored by members of the Screen Time Action Network’s Screens in Schools Work Group, including Emily Cherkin, a screen time consultant on faculty at the University of Washington’s Evans School of Public Policy along with other online and mental health experts.

“It’s an unproven, untested product, and we’re giving it to children in the name of improving education or equity or cognition, when none of those things have been proven,” Cherkin told Fortune. “If a local children’s hospital told parents, ‘We’ve got this new drug, it has potential to save lives, just trust us,’ people would be horrified. We have vetting processes for all kinds of industries, and yet somehow we’re allowing generative AI companies access to our most vulnerable population.”

The experts’ core finding is that AI doesn’t just distract children: it actively interferes with the developmental work they need to do. The human brain isn’t fully formed until the mid-20s, and the prefrontal cortex, used in planning, reasoning, emotion regulation, and critical thinking, is among the last regions to mature. “The problem with giving children generative AI is not just that they will cognitively offload the skill building,” Cherkin said. “It’s that they will displace the building of those skills even in the first place. If they’re never building skills, they have none to offload.”

The report pointed to a joint MIT and Harvard study finding that AI use accumulates “cognitive debt,” impairing independent thinking over time. Similarly, OECD research found that students who use ChatGPT as a study tool actually perform worse on tests than peers without access, even when the AI tutor has been programmed not to provide direct answers.

The mental health findings are equally apparent. Google and Character.AI are currently facing lawsuits alleging its chatbot contributed to user suicides and induced children to harm family members. The American Psychological Association issued a health advisory on AI and adolescent well-being. The report notes that teachers, therapists, and counselors must maintain licensure and follow ethics codes to work with children, but generative AI products face none of those requirements, and have been found to violate ethical standards in providing mental health support.

Under-resourced schools are more likely to rely on AI as a substitute for human teachers while well-resourced schools retain them. Because AI training datasets contain historical bias, the report warns, these products are likely to amplify existing educational inequities rather than close them. A February 2026 Pew Research Center survey found that 60% of teenagers say students at their school use chatbots to cheat “very often” or “somewhat often.”

The report is also pointed about what remains unknown. There is no proven educational benefit to generative AI in schools: it is marketed purely on “potential,” which the authors define as “literally what something is not.” Long-term effects on children’s cognitive and social-emotional development are entirely uncharted. “Giving children untested generative AI products based on future potential is dangerous,” the report states.

“The precautionary principle must be employed,” Cherkin said. “The best preparation for a digital future is an analog childhood. If we want kids to navigate generative AI someday, we should be doubling down on the skills that help them think critically, and that’s not happening at all.”

In New York City, Haimson, who is also a member of the DOE’s own AI working group, said Mayor Zohran Mamdani has failed to deliver the break from the previous administration that advocates were promised. “We were hoping for a new attitude in the mayor’s office and at DOE, and we just don’t see it,” she told Fortune. “We see basically the same people running the show. Many of them EdTech enthusiasts, many of them Google fellows. We’re basically seeing our kids’ futures being sold out to EdTech.”

She had stark words for the new mayor, who recently celebrated 100 days in office. “He said he himself doesn’t use AI, which is good, but why is he foisting it on New York City public school students?”

Haimson said the DOE’s AI working group was stonewalled. Officials refused to provide a list of AI products currently in use in city schools, citing NDAs with vendors, and denied requests for teacher training materials. The AI guidance that finally emerged in March was reportedly produced by Accenture, the consulting firm, with no meaningful input from privacy experts or parents. The advisory council that shaped the guidance, she said, was stacked with industry representatives, a legacy of the Eric Adams era and former Chancellor David Banks, who resigned after an FBI investigation.

The coalition is also raising a structural contradiction at the heart of the industry’s school push: AI companies prohibit minors in their own terms of service while simultaneously marketing to schools. Anthropic’s Terms of Use bar users under 18, yet MagicSchool AI, one of the most widely used K-12 platforms in the country, is built on Anthropic’s models.

The five-year pause, advocates say, would allow time for independent third-party audits of AI platforms, a vetting process for new products, a public registry of every AI tool currently used in schools, and regulatory frameworks that don’t yet exist. Any product that fails that process, the coalition says, should not get a second chance.

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Marine traffic leaving the Middle East has again dropped from a trickle to barely a drip. This comes after a decision by the U.S. to blockade Iran’s ports in response to threats by Iran to attack energy exports it hadn’t approved leaving the critical Straight of Hormuz chokepoint.

As Asia struggles with energy shortages that now threaten to spread to Europe, the U.S., meanwhile, remains bountifully supplied with almost record-high crude oil and natural gas production, leading President Donald Trump and others to tout the nation’s “energy independence.” Less than 3% of U.S. oil consumption typically comes from the Middle East—near an all-time low.

So why have gasoline, diesel, and jet fuel prices continued to spike? The U.S. average price for a gallon of regular unleaded gasoline is $4.11 as of April 15, according to AAA. That’s up 50% from a January low of $2.73. California, partially dependent on Asian fuel imports, spiked to $5.88 per gallon. For diesel, the national average is $5.64 a gallon.

“The problem is that oil is a global commodity. We may have plenty of oil—there’s no shortage of U.S. oil—but energy independence is somewhat of a fallacy,” said Jim Wicklund, veteran oil analyst and managing director at the PPHB energy investment firm. “We still have to pay the going world price. It’s a global price.”

The U.S. may be much more “energy secure” than the Arab oil embargoes of the 1970s, but it isn’t independent, Wicklund told Fortune. And the U.S. still imports a little more oil—largely from Canada, Mexico, and Venezuela—than it ships out.

The U.S. doesn’t have nearly enough surplus oil to fill the Middle Eastern void, Wicklund said, and U.S. oil drilling and production has only ticked up slightly since the war began.

There is growing talk of countries “hoarding oil” and restricting exports, said Arjun Murti, energy macro and policy partner at the Veriten research and investment firm. For the U.S., though, a hoarding strategy doesn’t appear that viable. That’s because the country must import heavier grades of crude oil for local refineries, and export excess lighter oil produced domestically, while U.S refineries need to export surplus gasoline and diesel or risk decreasing their operations.

“The instinct on politicians will be to restrict exports, but there’s the need to trade all of this stuff globally to match up supply and demand,” Murti told Fortune. “You can’t restrict your way to lower prices. You need the trade.”

The good news for the U.S. is that supply shortages almost certainly won’t occur because of its world-leading domestic production volumes. “The risk to us is inflation, and any hit to the global economy ultimately is a risk to our economy,” Murti said.

In the meantime, U.S. energy exports are on the rise, with combined crude oil and refined petroleum products exports hitting an all-time high of 12.7 million barrels a day for the week that ended April 10. The exports spike is driven largely by the increasing drawdown of barrels from the U.S. Strategic Petroleum Reserve, which commenced in late March.

Benchmark oil prices are hovering above $90 per barrel—much higher than the roughly $60 price tag at the beginning of the year, but down since the ceasefire began on rising market optimism.

But it’s important to realize that the European and U.S. benchmarks, Brent and WTI, respectively, are futures contracts largely for oil trading. The front-month contract for Brent oil is for June barrels, while WTI—West Texas Intermediate—is still on the May contract until it settles April 21 and rolls over to June.

The barrels already set for physical delivery in the coming days and weeks, such as dated Brent, are selling for closer to $120—a historic gap between physical and futures prices.

“All these prices are linked globally. If prices go up somewhere, they go up everywhere,” Murti said.

Reaching a critical juncture

The growing problem is that—more than halfway through a two-week ceasefire in Iran—all the surplus oil and gas storage and waterborne shipments are running dry after a six-week-long supply shock.

“We’re getting to that critical point where higher flows of oil and refined products and other stuff—fertilizer and helium—are going to have to resume in greater quantities, or we run into the risk of a more severe hit to the global economy,” Murti said.

Wicklund said we’re less than two months from a “global recession” if the strait isn’t reopened before then. “I’m hopeful, but the situation has changed, and I think it’s gotten more dangerous,” Wicklund said, with the ceasefire being so tenuous and demands from both sides seemingly far apart.

By the end of May, the world enters into seasonal energy demand increases, including the busy summer driving season.

On April 15, the White House reiterated that it feels good about a potential deal. The leadership of the United Arab Emirates and Iran are talking, which could represent progress after Iran bombed the UAE and other neighbors. Likewise, Israel and Lebanon began discussing a ceasefire. But nothing is concrete.

In the meantime, U.S. Treasury Secretary Scott Bessent said the U.S. is pushing to freeze the funds of Iranian leaders in the banks of neighboring Gulf states, and that countries buying Iranian oil could face secondary sanctions. Tensions could rise with China since nearly all Iranian crude heads there.

For marine vessels nearing the Strait of Hormuz, the U.S. Navy is issuing this message: “Do not attempt to breach the blockade. Vessels will be boarded for interdiction and seizure transiting to or form an Iranian port. Turn around and prepare to be boarded. If you do not comply with this blockade, we will use force. The whole of the United States Navy is ready to force compliance.”

Several vessels have crossed the strait this week, but few have exited the broader Arabian Sea where the U.S. blockade is set up, largely preventing escapes into the Indian Ocean.

Ana Subasic, a trade risk analyst for Kpler, the intelligence firm that tracks marine vessels, said none of the Iranian oil tankers have entered the ocean since the U.S. blockade commenced.

“A lot of them have stopped. None have gone through,” Subasic told Fortune on April 15, noting that the situation remains “very fluid.”

“There are no new attacks, but there also are no new Iranian loadings, so that’s a significant signal the blockade is working,” Subasic said of this no-fighting, but no-oil ceasefire limbo.

The most notable vessel thus far, the Rich Starry tanker, an oil and chemicals tanker carrying methanol bound for China, originally did a U-turn away from the strait on April 13 as the blockade began, then turned around and passed through the strait on April 14, but then turned around yet again after leaving the strait as it met the U.S. blockade, Subasic said. That adds up to three U-turns in just over 24 hours for the tanker.

Some container ships—not carrying energy products—have exited the region, and the U.S. continues to insist the blockade is only for vessels leaving Iranian ports. That said, most other tankers are avoiding the strait for fear of being targeted by Iranian attacks. Hundreds remain trapped within the Persian Gulf.

And, even if the war ends soon, energy prices will remain elevated at least through the end of the year as supply chain disruptions are resolved, Wicklund said.

“There will be a risk premium for a while, and it will be reflected in global oil prices,” he said.

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